Apple Discontinues 'Apple Pay Later'

On Monday, Apple announced the discontinuation of its “Apple Pay Later” service, mere months after its nationwide rollout in the United States last October. The iPhone maker conveyed this decision to 9to5Mac, citing a strategic shift in its instalment loan offerings.

“Starting later this year, users globally will be able to access instalment loans offered through credit and debit cards, as well as lenders, when checking out with Apple Pay,” Apple stated. “With the introduction of this new global instalment loan offering, we will no longer offer Apple Pay Later in the US.”

The decision comes in the wake of mounting speculation regarding Apple’s partnership with Goldman Sachs. Since 2019, the tech giant and the banking firm have collaborated on an Apple-branded credit card, followed by a high-yield savings account in 2022. However, increasing financial losses have reportedly caused Goldman Sachs to reassess this partnership. In January 2023, the bank disclosed losses of $3 billion from its consumer banking operations since 2020.

Apple is reportedly planning to end its partnership with Goldman Sachs within the next 12 to 15 months, according to a report by The Wall Street Journal in November, citing sources familiar with the situation. It remains uncertain whether Apple will seek another financial services partner, though prospects appear slim. Previously, Citigroup opted out of a potential partnership due to profitability concerns, as reported by CNBC in May 2019.

These developments highlight the significant challenges Apple faces in its efforts to penetrate and disrupt the established financial services industry. While the Cupertino-based company has a formidable history of revolutionizing various sectors—such as the music industry with the iPod and iTunes, and the mobile phone market with the iPhone—recent ventures have not achieved similar success.

Apple’s attempt at innovation with the mixed-reality headset, Apple Vision Pro, faced lacklustre sales and mixed reviews. Additionally, the company announced in the same month that it was ceasing its electric car project after nearly a decade of development, as reported by Bloomberg.

Apple’s recent struggles underscore the complexities and hurdles in its pursuit of new market disruptions, reflecting both the high stakes and formidable challenges inherent in the financial services sector.

Main Image: 9to5Mac