Apple is shutting down the popular feature just a year after its launch, which is a big blow to iPhone users

Apple shut down the popular feature just a year after launching it, which was a big blow to iPhone users.

The tech giant has withdrawn its “buy now, pay later”, known as Apple Pay Later, which allows users to take out loans for purchases of up to $1,000 and repay the borrowed amount in four installments over six weeks.

While this option is no longer available, consumers who have existing loans will not be affected.

Apple’s decision to scrap its “buy now, pay later” service comes as it said it plans to launch a similar program in the fall that will allow users to access loans from authorized credit and debit card companies.

Apple Pay Later launched with fanfare in March 2023, the company’s response to the growing popularity of buy now, pay later services around the world, and was seen as a significant threat to companies like Klarna, Affirm and others.

But Apple’s feature was only available where its digital payment service was accepted, while other buy-now-pay-later companies have deeply integrated into millions of merchant websites.

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“With the introduction of this new global installment loan offering, we will no longer offer Apple Pay later in the US,” Apple said late Monday.

“Our goal is to continue to provide our users with access to easy, secure and private payment options with Apple Pay, and this solution will allow us to bring flexible payments to more users in more locations around the world in partnership with Apple Pay. eligible banks and lenders.’

The announcement led to Apple ending any new Apple Pay Later loans.

“Starting later this year, users around the world will be able to access installment loans offered through credit and debit cards, as well as lenders, when they pay with Apple Pay,” Apple told 9to5Mac.

Instead of working as a lender itself, Apple will focus on helping users secure additional lending options that “allow us to bring flexible payments to more users in more locations around the world by partnering with Apple Pay-enabled banks and lenders.” the company added.

This option will be available in the US at Discover credit card and retail loan providers Synchrony Financial and Fiserv Solutions, which can be accessed directly through Apple Pay.

The new feature will also allow users to apply for a loan from Affirm, a buy-now, pay-later lender that offers short-term loans for online and in-store purchases.

Users will be able to add a loan option at checkout, allowing them to apply for a loan through a credit card and loan service or directly through Affirm.

The new loan feature will still skip any hidden fees, offer zero interest and allow users to split payments into four installments to be paid over six weeks.

According to a June survey by LendingTree, about 13 percent of 889 respondents said they had used Apple’s buy now, pay later feature, while one in three Americans said they had considered applying for an installment loan.

Users in Australia, Spain and the UK – who previously didn’t have access to Apple’s buy now pay later feature – will also have access to installment options from the autumn.

Apple launched “early access” to the feature in March 2023 and issued loans itself, but it didn’t officially launch until October.

A partnership with its former competitor Affirm could help the company expand its loan program to offer longer-term repayment options, according to JPMorgan analyst Reginald Smith.

“Afirm does not expect a material impact on FY25 earnings.” . . but it’s hard to imagine that adding a platform of this scale won’t move the needle,” Smith wrote last week, according to the Financial Times.

At the Worldwide Developers Conference in California last week, a move to partner with Affirm and other credit and debit card companies to replace buy-now-pay-later was unveiled.

DailyMail.com has reached out to Apple for comment.