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Affirm (AFRM) to Offer BNPL for Amazon Canada Customers

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Affirm Holdings, Inc. (AFRM - Free Report) recently announced that it has extended its partnership with Amazon.com, Inc. (AMZN - Free Report) to provide a buy now, pay later (BNPL) option for customers in Canada. The Pay-Over-Time option is expected to be available for customers using Amazon.ca during checkout by the next month.

Customers choosing Affirm for payment are expected to come across a soft credit check, which is not likely to affect their credit score, followed by several available options for payment. People are expected to split bills of $50 or above in monthly payments. As Affirm will not charge late and hidden fees, it is expected to witness significant demand growth in Canada for its payment products.

AFRM already has a strong foothold in the U.S. market, where it has partnered with big companies like Amazon. The latest partnership is expected to further boost its presence in the North America market and is also likely to increase its merchandise volume. The partnership with Amazon Canada is the latest addition to the company’s rapidly growing network of 235,000 merchants and almost 14 million consumers.

The latest move comes at a time when businesses are looking forward to a strong holiday season. Thanks to fading COVID restrictions, pent-up demand and lingering savings, consumer spending is expected to significantly grow in the days ahead. The potential spending growth is expected to follow a successful summer trend. Affirm’s 2022 summer consumer spending trends showed that travel was in the second spot on the list, furniture and homewares was third, and apparel was in the fourth position.

The rise in spending reflects higher transaction volumes for payments companies. With growing dependence on BNPL solutions and similar services due to rising inflation, companies like Affirm are expected to benefit from higher volumes in the coming quarters.

Price Performance

Over the past year, shares of Affirm have decreased 82.5% compared with the 49.3% fall of the industry it belongs to.

Zacks Investment Research
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Zacks Rank & Key Picks

Affirm currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Business Services space are PaySign, Inc. (PAYS - Free Report) and International Money Express, Inc. (IMXI - Free Report) , both carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Based in Henderson, NV, PaySign offers prepaid card products and processing services. The Zacks Consensus Estimate for PAYS’s 2022 earnings indicates 280% year-over-year growth.

Miami-based International Money Express works as a money remittance services company globally. The Zacks Consensus Estimate for IMXI’s 2022 bottom line indicates 18.4% year-over-year growth.

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