Apple Pay Later is delayed as company faces “technical and engineering issues”

Digital
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Reports suggest that Apple’s much-publicised buy now, pay later service may not arrive until next year. This is because the company is reportedly facing “significant” setbacks.

Apple Pay Later will be Apple’s entry into the buy now, pay later (BNPL) market. It will allow customers to make a payment through Apple Pay and then pay it back in four instalments, without paying interest on the money owed.

Why has Apple Pay Later been delayed?

Originally, Apple said that its buy now, pay later feature would arrive with iOS 16. However, Apple now states that Apple Pay Later is “coming in a future update” in the fine print of an iOS 16 page on its website. But, Apple Pay is the only unreleased feature on that page and Apple is not providing a timeframe for when it will be released. By contrast, other features such as no-setup Siri shortcuts are listed as “coming later this year”.

Due to this, many experts now believe that the feature will not be ready until the release of iOS 16.4 in the spring of 2023. There are rumours that the delay of Apple Pay Later has been caused by significant technical and engineering challenges in rolling out the service

Ultimately, the rollout of Apple Pay Later will mean that Apple needs to take on new financial responsibilities. Earlier this year, reports indicated that the company’s subsidiary, Apple Financing LLC, would handle the lending for Apple Pay Later while remaining separate from Apple’s main business. Apple currently partners with Goldman Sachs to perform credit checks and lending for Apple Card, the company’s Mastercard-based credit card, but the company is bringing these services in-house for Apple Pay Later.

Apple Pay Later and the wider state of the BNPL market – the view from Spike

This year, government regulators have begun to pay closer attention to BNPL services such as Klarna, Affirm and Afterpay. This is due to fears over whether these services pose a risk to customers who often struggle to meet payments.

Once Apple Pay Later is rolled out, the service has the potential to reach even more users than other BNPL services, as the feature will be built straight into the iPhone. Due to this, there is a huge amount of pressure for Apple to get things right and satisfy regulators.

Given Klarna’s recent well-publicised struggles, there’s clearly a window of opportunity for a seamless BNPL that would provide a boost to ecommerce and could be a game changer in the industry. However, given Apple’s struggles in rolling out Apple Pay Later, this gap in the market could remain unfilled until next year.