I’m seeing Affirm in lots of places lately as a way to pay the same amount of money for your purchase but over installments with zero interest. How do they make money? My only guesses are a kickback in the seller’s end or they’re selling user data. Anyone know?
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Businesses like this have two main revenue streams, from two different “products”.
The first stream is the one you see – the loans. For Affirm, some loans *do* have interest, which means you pay them for it. For other companies, they impose hefty late fees and such if you don’t pay on time.
The second stream is one you don’t directly see – kickbacks from businesses, like you figured. Whenever you make a purchase using one of these services, the seller pays them for it. The idea is that most of the sales wouldn’t have happened without the loan, so it’s still more money for the business.
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