Apple has discontinued its Apple Pay Later service less than a year after launch, opting to replace it with global installment loans offered through third-party companies later this year.

This shift comes amid growing scrutiny of the buy now, pay later (BNPL) sector by financial regulators, who have been implementing new consumer protection rules. Apple Pay Later's discontinuation marks a significant change in Apple's financial services strategy, aiming to broaden its reach by partnering with companies like Affirm and major card issuers while continuing to offer installment payment options through the Apple Pay checkout process. Current users will still manage their remaining Apple Pay Later loans via the Apple Wallet app.

[Apple Pay Later, launched](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) in the U.S. in March 2023, allowed customers to [divide purchases into four](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) equal payments spread over six weeks with no interest charges. However, the service faced challenges competing with established BNPL providers like Afterpay and Klarna. According to Apple, the [decision to discontinue the service](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) aligns with a broader strategy to [integrate more comprehensive financial solutions](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) for its users through third-party partnerships.

[Regulatory scrutiny](https://www.cbsnews.com/news/apple-pay-later-service-discontinued-bnpl-plans/) has played a significant role in reshaping the BNPL industry. [The Consumer Financial Protection Bureau (CFPB)](https://www.cbsnews.com/news/apple-pay-later-service-discontinued-bnpl-plans/) and other regulatory bodies have raised concerns over the potential for consumers to accrue debt rapidly and fall into financial hardship. [New regulations are being introduced](https://www.cbsnews.com/news/apple-pay-later-service-discontinued-bnpl-plans/) to ensure greater transparency, affordability checks, and clearer repayment terms for BNPL services.

"As the regulatory environment evolves, it's crucial for companies like Apple to adapt and prioritize [consumer safety](https://www.cbsnews.com/news/apple-pay-later-service-discontinued-bnpl-plans/)," said John Thompson, a financial analyst at MarketWatch. "By [collaborating with established financial institutions](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602), Apple can deliver more robust and compliant financial solutions."

Customers currently using Apple Pay Later will continue to [manage their outstanding loans](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) [via the Apple Wallet app](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) until they are paid off. Apple is ensuring a smooth transition by providing support and clear communication to its customers. Meanwhile, the company encourages users to explore [the new installment loan options](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) that will soon be available through its partnerships.

[Apple's announcement to close its BNPL](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) service also highlights a growing trend among tech companies to shift away from financial products amid [increased regulatory pressures](https://www.cbsnews.com/news/apple-pay-later-service-discontinued-bnpl-plans/). Other tech giants, such as Google and Amazon, have also re-evaluated their financial service offerings, focusing more on partnerships with traditional financial institutions rather than direct service provision.

The move to [partner with companies like Affirm](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) and major card issuers signifies Apple's commitment to expanding its ecosystem while adhering to stricter regulatory frameworks. These partnerships will enable Apple to [offer installment payment options](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) on a global scale without taking on the regulatory risks associated with managing a BNPL service directly.

"We believe [this new approach](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) will provide our customers with more [flexible and secure payment options](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602)," said an Apple spokesperson. "[By leveraging the strengths of our partners](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602), we can continue to innovate and enhance the financial solutions available to our community."

Financial experts suggest that [partnering with well-established financial service providers](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) could bolster Apple's position in the financial sector. They argue that these collaborations could provide Apple with a more sustainable model for offering installment payment options while ensuring [compliance with emerging regulations](https://www.cbsnews.com/news/apple-pay-later-service-discontinued-bnpl-plans/).

Apple Pay has been a significant part of the company's efforts to expand beyond its core electronics business, enabling Apple to capitalize on the growing trend toward digital and mobile payments. [The discontinuation of Apple Pay Later](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) and the [transition to third-party installment loans](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) indicate Apple's strategy to refine and [expand its financial services](https://www.nbcnews.com/business/consumer/apple-stops-offering-buy-now-pay-later-loans-us-rcna157602) with a focus on global reach and regulatory compliance.