Walmart debuts new buy now pay later program that charges interest to replace layaway


Walmart has recently announced a new program called Affirm which offers a buy now pay later option. It has shut down its traditional layaway program that had allowed customers to book products well in advance from late August to mid-December; to be purchased later when payments were completed, mainly during the holiday season. It had been phasing out the program.


Its website stated that the retailer offered Affirm, an easy and affordable monthly payments program that could be used in-store or online, Customers could choose the pace of payments that were within a term of three months to two years. The retailer said that this program was an alternative to layaway and customers could buy products immediately and pay for them later.


The Affirm app does not charge any hidden fees or late fees. However, it can add up interest over time. Customers will have an annual percentage rate (APR) that would be between 10 to 30 percent, depending on their credit scores, that would appear when checking out on the app. Some promotional items can be purchased at zero percent.


Customers have to prequalify to use Affirm services, for a price range between $144 to $2000. Some of the categories on which Affirm could be applied include electronics, home goods, toys, jewelry and clothing. Certain categories including alcohol, groceries, personal care products and pet supplies are excluded from the program. A comprehensive list is available on the website.


Affirm services are similar to a credit card. A customer purchases an item immediately but pays for it choosing a plan within two years. Affirm links them to a lender, who will finance the purchase as a loan.


When Walmart customers return a purchased item, the interest amount will not be refunded. Customers’ credit score will change if they make partial or late payments and might affect future loans.




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