Are subscription plans the future of BNPL?

Good morning!

Affirm is considering launching a subscription service named Affirm Plus. The intention is to generate more consistent revenue beyond their traditional buy now, pay later plans.

This potential service was found within the code of its iPhone application.

If implemented, subscribers would be charged $7.99/month and would be entitled to a 0% APR on installment loans up to $2500. The current APRs offered by Affirm vary from 0% to 36%.

Furthermore, subscribers might gain access to a higher interest rate for their Affirm savings accounts, with the code mentioning an APY of 4.75%, compared to the current 4.35%.

However, there's no assurance that the service will be launched or feature all the mentioned benefits.

This exploration is part of Affirm's strategy to find fresh revenue streams and increase its user base amidst growing competition in their market sector.

Affirm declined to provide detailed comments about this initiative.

The company, based in San Francisco, was co-founded by Max Levchin, a PayPal co-founder. Levchin recently mentioned Affirm's interest in expanding its financial product offerings. The potential subscription model may also serve as a means to counterbalance increasing funding costs the company faces as interest rates rise.

Affirm is not the first though. Earlier this year Afterpay already launched a similar product called the "Afterpay Plus Card".

Is a subscription really going to be the solution for BNPL providers?

What do you think?

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