eli5: How do companies like afterpay and Latitude pay make money when they don’t charge interest ever?

Question

eli5: How do companies like afterpay and Latitude pay make money when they don’t charge interest ever?

In: Economics

Answer 1

The merchants pay a fee to the companies to have them be a payment option. If the merchant wants to offer payment plans, it shifts the work and risk to the payment company. And by offering payment plans, the merchant hopes to sell more high-priced products.