Affirm Partners with Esusu for 0% APR Rent Payment Splitting Program
Moonfire co-founder and managing partner Mattias Ljungman joins ‘Mornings with Maria’ to break down Klarna’s $17B IPO surge, the rise of ‘buy now, pay later’ and fintech’s challenge to big banks.
Buy now, pay later giant Affirm is making strides to assist renters by allowing them to break up their housing payments in a way that aligns with their biweekly paychecks.
In collaboration with financial technology platform Esusu, Affirm is piloting a program that enables renters to split their monthly rent into two equal payments every two weeks, all at 0% APR. Notably, this pilot program comes with no hidden fees, late fees, or compounding interest, according to Affirm.
Esusu plays a crucial role in helping renters build credit by reporting their on-time rent payments to major credit bureaus. This initiative aims to empower renters financially.
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Affirm stated that the pilot program is designed to provide “eligible renters a flexible option for managing one of their largest monthly expenses.” They emphasized that this is a “transparent option that offers flexibility for renters to align expenses with their paychecks.”
An apartment for rent sign is posted in South Pasadena, California. (Frederic J. Brown/AFP via Getty Images)
Affirm also noted that it underwrites every application individually, approving only those it believes the applicants can responsibly afford to repay.
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“We’re approaching this use case thoughtfully and evaluating it alongside Esusu, which shares our focus on clear, consumer-first financial tools,” Affirm added.
The pilot program is designed to give “eligible renters a flexible option for managing one of their largest monthly expenses,” Affirm said. (Andrew Harrer/Bloomberg via Getty Images / Getty Images)
While the company has not confirmed when the pilot program will officially launch, it remains in the early stages of development.
LendingTree’s chief consumer finance analyst, Matt Schulz, mentioned to FOX Business that this initiative could be beneficial for those on a tight budget, but he also cautioned that it is premature to draw any definitive conclusions.
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“This is just another example of how it is getting easier seemingly by the day for people to use BNPL to finance most anything,” Schulz noted.
A “for rent” sign is posted in front of a house on June 15, 2012 in Richmond, California. (Justin Sullivan/Getty Images)
Schulz pointed out that this model does not resemble a typical pay-in-four BNPL loan. He warned that if it were, it could lead to significant risks, such as consumers still paying off previous BNPL loans when the next month’s rent is due. “That could get messy,” he cautioned, adding that while this financial tool can be beneficial when used wisely, “the danger with BNPL is when you have multiple loans that you have to manage.”
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Another critical aspect of this payment method is its connection to a debit card or checking account, making it essential for users to have sufficient funds available to cover the bill.
Moonfire co-founder and managing partner Mattias Ljungman joins ‘Mornings with Maria’ to break down Klarna’s $17B IPO surge, the rise of ‘buy now, pay later’ and fintech’s challenge to big banks.
Buy now, pay later giant Affirm is making strides to assist renters by allowing them to break up their housing payments in a way that aligns with their biweekly paychecks.
In collaboration with financial technology platform Esusu, Affirm is piloting a program that enables renters to split their monthly rent into two equal payments every two weeks, all at 0% APR. Notably, this pilot program comes with no hidden fees, late fees, or compounding interest, according to Affirm.
Esusu plays a crucial role in helping renters build credit by reporting their on-time rent payments to major credit bureaus. This initiative aims to empower renters financially.
JPMORGAN CFO WARNS TRUMP’S PROPOSED CREDIT CARD CAP COULD CAUSE PEOPLE TO ‘LOSE ACCESS TO CREDIT’
Affirm stated that the pilot program is designed to provide “eligible renters a flexible option for managing one of their largest monthly expenses.” They emphasized that this is a “transparent option that offers flexibility for renters to align expenses with their paychecks.”
An apartment for rent sign is posted in South Pasadena, California. (Frederic J. Brown/AFP via Getty Images)
Affirm also noted that it underwrites every application individually, approving only those it believes the applicants can responsibly afford to repay.
‘BUY NOW, PAY LATER’ SERVICES ARE DANGEROUS TRAP FOR YOUNG AMERICANS, FINANCIAL EXPERT WARNS
“We’re approaching this use case thoughtfully and evaluating it alongside Esusu, which shares our focus on clear, consumer-first financial tools,” Affirm added.
The pilot program is designed to give “eligible renters a flexible option for managing one of their largest monthly expenses,” Affirm said. (Andrew Harrer/Bloomberg via Getty Images / Getty Images)
While the company has not confirmed when the pilot program will officially launch, it remains in the early stages of development.
LendingTree’s chief consumer finance analyst, Matt Schulz, mentioned to FOX Business that this initiative could be beneficial for those on a tight budget, but he also cautioned that it is premature to draw any definitive conclusions.
BUY NOW, PAY LATER PITFALLS: MANY CONSUMERS AREN’T PAYING LOANS
“This is just another example of how it is getting easier seemingly by the day for people to use BNPL to finance most anything,” Schulz noted.
A “for rent” sign is posted in front of a house on June 15, 2012 in Richmond, California. (Justin Sullivan/Getty Images)
Schulz pointed out that this model does not resemble a typical pay-in-four BNPL loan. He warned that if it were, it could lead to significant risks, such as consumers still paying off previous BNPL loans when the next month’s rent is due. “That could get messy,” he cautioned, adding that while this financial tool can be beneficial when used wisely, “the danger with BNPL is when you have multiple loans that you have to manage.”
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Another critical aspect of this payment method is its connection to a debit card or checking account, making it essential for users to have sufficient funds available to cover the bill.
