Consumer lending startup Affirm has tried to make it easier for people to make big-ticket purchases at checkout by providing financing options that it believes are better than using a credit card.
Today Affirm has announced it has more than 1,000 merchants signed up to offer its financing options at checkout, helping to reduce the friction around making large purchases and, by extension, increasing sales for its partners.
While promoting its most recent milestone, Affirm is also trying to get across the message of how it’s different — and frankly, better — than point-of-sale financing options of the past. As a result, the company is pushing a marketing campaign around “honest finance” to enumerate the ways in which Affirm helps consumers by providing more access and better terms for big-ticket items.
After decades of predatory lending practices at checkout, it’s no wonder Affirm is trying to distance itself from the competition. Retailers seeking to boost sales previously aligned themselves with financing partners who sought to hoodwink consumers into adopting revolving credit lines built on compound interest, hidden fees and small print.
While advertisements promoted zero-percent interest on the cash borrowed to make a purchase, the banks financing those credit lines made the bulk of their money off of fees that inevitably sprung up if a consumer didn’t pay them off before the end of a certain term, or if they made a late payment.
So you can understand the skepticism of some people when offered the following financing offer while looking at a pair of $400 pants:
Got this ad on Instagram for $393 cotton pants available via subprime loan.
Tell me again, what are Millennials killing? pic.twitter.com/Z3YLlmCsjk
It’s easy to debate the merits of financing…