In other Walmart related news, the worlds largest retailer has decided to officially scrap its long-term financing option, layaway, for a new “buy now, pay later” partnership with Affirm. The partnership with Affirm was announced in early 2019, however customers at Walmart were still given the option of layaway for certain jewelry purchases and other high-ticket items.
What can you expect from this new phase of finance? The positive benefits of utilizing Affirm is the customer will be able to take the item home immediately and pay it off with Affirm at the comfort of their own home, instead of having stores hold items from late August through mid-December while customers make payments until paid in full.
However, unlike layaway, purchases made with Affirm may charge customers’ interest. Although Affirm does not currently charge any hidden or late fees using its services, customers can have an APR rate on purchases of 10-30% depending on their credit score, and 0% for select promotional items on Walmart.com. Affirms services operate alternatively to a credit card. Customers will purchase the item immediately, based on prequalification status, and pay for the items over a three-to-24-month period.
Affirm will screen each customer through a simple prequalification process that lets customers know how much they can responsibly spend on site. One question many customers are asking is “Will this affect my credit score?” – When a customer signs up using Affirm point-of-sale loan, you are taking a credit instrument. But Affirm doesn’t perform a hard credit check, only what is called a “soft pull” on your credit information, so simply taking out the loan will not affect your score.
One thing to note about this new financial aid is that it will have some exclusions like alcohol, groceries, personal care products, and pet supplies.
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