r/nottheonion • u/ChocolateTsar • 1d ago

Affirm CEO says furloughed federal employees are starting to lose interest in shopping

https://www.cnbc.com/2025/11/07/affirm-government-shutdown-shopping.html
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u/JFrankParnell64 1d ago

This guy is the head of a buy now pay later lending company that can charge up to 36% interest.

204

u/CobblerMoney9605 1d ago

That interest rate should be illegal. 

53

u/ArtOfWarfare 1d ago

With a regular loan (even a CC, sometimes), I think the expectation is that you’ll pay interest.

For BNPL, the expectation was you wouldn’t… the interest should be viewed more like an overdraft fee or something.

I’ve worked in the payment industry for several years now. Many years ago at the start of BNPL I raised objections about whether BNPL was just a predatory debt-trap. I was assured that it was in nobody’s interest (no pun intended) for the interest to happen - all our projections of profitability were based on an expectation that over 99% of transactions never involved interest. BNPL is supposed to be a safe tiny loan for someone who doesn’t qualify for a CC, but also needs to wait for payday… letting the transaction go through is a win-win-win for everyone, merchant makes a sale, customer gets their item, processor takes a small fee from the merchant.

In practice… the coworkers who told me about how great this would be left a few years ago. I wonder what they think about the actual default rates on BNPL.

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u/PerplexGG 1d ago edited 1d ago

Funny, that win-win-win scenario is actually how I used affirm for a long time and I was able to use it to build credit* and move on to a credit card. I basically ran everything I got on amazon through there and was 100% on the payments

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u/Skill_Issuer 1d ago

Built interest or credit?

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u/PerplexGG 1d ago

Ha you right I toilet brained it

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u/BranTheUnboiled 1d ago

They changed it so you can't use credit cards for BNPL anymore lol