Affirm is a fintech company that provides a point-of-sale lending platform for online and in-store purchases. Founded in 2012, Affirm offers consumers an alternative to traditional credit cards and loans by providing transparent, easy-to-understand financing options at the time of purchase. Here’s how Affirm works:
- Application: When a customer is ready to make a purchase, they can choose Affirm as the payment option at checkout. The customer then provides some basic information to Affirm, including their name, address, and date of birth.
- Credit check: Affirm performs a soft credit check to assess the customer’s creditworthiness and determine if they are eligible for financing. This check does not affect the customer’s credit score.
- Financing options: If the customer is approved, Affirm presents them with a range of financing options, including the interest rate, monthly payment, and repayment term. The customer can choose the option that best fits their budget and needs.
- Payment: Once the customer selects a financing option, they complete the purchase with Affirm. Affirm pays the merchant in full, and the customer begins making payments directly to Affirm on the agreed-upon schedule.
- Repayment: Affirm offers flexible repayment options, including monthly installments or a one-time payment. Customers can also pay off their loan early with no penalties or fees.
- Customer support: Affirm provides customer support through phone, email, and live chat, and has a comprehensive FAQ section on its website to help customers troubleshoot any issues they may encounter.
Affirm is primarily used for purchases of high-ticket items, such as furniture, appliances, and electronics, but can also be used for smaller purchases. It is similar to other point-of-sale lending platforms like Afterpay and Klarna, but Affirm’s focus on transparent pricing and customer education sets it apart.
Here are some of the main features of Affirm:
- Point-of-sale financing: Affirm provides consumers with financing options at the point of sale, which means they can choose to pay for their purchases over time, instead of all at once.
- Transparent pricing: Affirm offers customers clear and transparent pricing, with no hidden fees or compounding interest. Customers are presented with a range of financing options, including the interest rate, monthly payment, and repayment term, so they can choose the option that best fits their budget and needs.
- No late fees or prepayment penalties: Affirm does not charge late fees or penalties for prepaying a loan. Customers can pay off their loan early with no penalties or fees.
- Soft credit check: Affirm performs a soft credit check to assess the customer’s creditworthiness and determine if they are eligible for financing. This check does not affect the customer’s credit score.
- Mobile app: Affirm has a mobile app that allows customers to manage their loans, make payments, and track their repayment progress.
- Customer support: Affirm provides customer support through phone, email, and live chat, and has a comprehensive FAQ section on its website to help customers troubleshoot any issues they may encounter.
- Partnership with merchants: Affirm partners with a wide range of merchants, both online and in-store, to offer financing options to their customers.
Overall, Affirm is designed to provide consumers with an alternative to traditional credit cards and loans, with transparent pricing and flexible repayment options.