Apple Pay Later: WWDC’s Biggest Announcement?

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09 JUNE 2022 - Apple CEO Tim Cook says that Apple’s moves in health will be the company’s greatest contribution. He’s spoken of augmented reality one day rivaling the smartphone. While Apple Pay Later may not reach the lofty heights of those two categories, it feels like the argument could be made that that was the most important announcement at Monday’s WWDC keynote.

Because they’re doing it themselves.

Recapping what it is, a piece from MacRumors says:

With ‌Apple Pay‌ Later, ‌Apple Pay‌ users can choose to make four payments spread over a six week period instead of paying up front. The ‌Apple Pay‌ Later feature includes no interest or fees so long as customers make the four payments within the allowed period.

And there’s no bank backing it up. Rather, the piece says:

Apple has launched a subsidiary, Apple Financing LLC, to handle credit checks and make decisions on loans for the service.

Goldman Sachs, the bank that backs Apple Card, still has a part to play. The piece says the bank “issues the Mastercard payment credential used to complete ‌Apple Pay‌ Later purchases” since Apple Financing can’t because it’s not a full fledged financial institution. Yet. The piece sites a Bloomberg report from last March that had Apple “working on a multiyear plan to bring its financial services in house, cutting out the need for partners like Goldman Sachs.” Now, MacRumors says:

Apple is working on payment processing technology and infrastructure such as lending risk assessment, fraud analysis, credit checks, and dispute handling, plus it is working on tools for calculating interest, rewards, approving transactions, reporting data to credit bureaus, increasing credit limits, and more.

Even if Apple’s goal is to become a full fledged financial institution, it’ll take a while. That said, the CEO stressed at this week’s TIME100 Summit that Apple thinks in terms of years, not quarters.

Apple announced a lot of important stuff during the WWDC keynote. As a steppingstone for its business longterm though, Apple Pay Later may have been the most important.