What Is Affirm & How Does Buy Now, Pay Later Work?

Affirm is a buy now, pay later (BNPL) payment option. For online retailers, offering Affirm can significantly boost conversion rates and increase average order value.

We consider Affirm one of the best BNPL apps available. If you’re new to buy now, pay later or considering adding it to your online store, this guide breaks down how Affirm works, what it costs, and whether it’s the right fit for your business.

What Is Affirm?

Affirm is a buy now, pay later (BNPL) service that lets customers split purchases into smaller, manageable payments instead of paying the full amount upfront. In essence, Affirm offers short-term consumer loans that make larger or unexpected purchases more affordable.

For merchants, adding Affirm can lead to higher sales and repeat business. BNPL tools like Affirm are especially effective for:

• High-ticket sellers (items over $500)

• Brands targeting younger shoppers, who often use BNPL for smaller purchases under $100

Because Affirm provides instant loan approval without a hard credit check, it appeals to customers looking for flexibility without using credit cards.

In short, offering Affirm at checkout helps remove price barriers, improve conversions, and give shoppers an easy, confidence-boosting way to buy now and pay later.

Is Affirm Safe?

Affirm is considered a safe and legitimate buy now, pay later provider for both shoppers and merchants. However, it doesn’t offer the same protections as credit cards (such as zero-liability fraud coverage), and refunds can take time if customers return items after purchase.

Affirm holds an A+ rating with the Better Business Bureau and earns mostly positive user feedback. Most of its Trustpilot reviews are five stars, with most complaints centered on delayed refunds or confusion about payment schedules. Overall, Affirm is widely viewed as a secure and easy-to-use payment option.

How Does Affirm Work?

Affirm lets shoppers split purchases into manageable payments — online or in person — often without traditional credit cards or upfront cash. Here’s how it works:

1. At Checkout: Shoppers choose Affirm as their payment method, either online or through a store that accepts Visa.

2. Instant Approval: Affirm runs a soft credit check (which doesn’t affect credit scores) and quickly presents repayment options, usually ranging from 3 to 36 months.

3. Transparent Terms: Before confirming, buyers see exactly how much they’ll pay each month and the total interest (0%–36% APR, depending on credit history, loan length, and retailer terms).

4. No Hidden Fees: Affirm doesn’t charge late fees, though missed or partial payments can hurt your credit score and limit future financing.

5. Virtual Card & App: Once approved, buyers receive a digital payment card via the Affirm app (available on iOS and Android) to complete the purchase. The app also lets users prequalify, track repayment dates, and make secure payments.

For merchants, adding Affirm at checkout gives customers flexible payment options, often leading to higher order values and repeat purchases.

Who Can Offer Affirm Loans?

Affirm partners with U.S.-based businesses of all sizes across many industries. To qualify, you must sell directly to U.S. consumers, have a U.S. bank account, list prices in USD, and maintain an English-language website.

However, Affirm prohibits certain industries and products. Businesses selling counterfeit or unauthorized goods, controlled substances, pseudo-medical products, firearms, knives, explosives, or adult or violent material are not eligible. Affirm also avoids working with companies in high-risk categories.

If your business meets the basic requirements, the next step is deciding whether adding Affirm makes sense for your customers and your bottom line.

Benefits Of Adding Affirm As A Payment Option

The biggest benefit of adding Affirm as a payment option is that it makes it easier for customers to buy from you. Other benefits include:

• Higher Order Values: Businesses using Affirm often see up to an 85% boost in average order value, as customers can spend more with flexible payment options.
• Repeat Customers: About 20% of BNPL users return for another purchase, thanks to simple, low-friction payment plans of up to 36 months.
• Younger Shoppers: Nearly 80% of Gen Z and Millennials use BNPL, making Affirm an easy way to appeal to younger buyers.
• Fast Payouts: You get paid in full within 1 to 3 business days, even though customers pay over time.
• Easy Integrations: Affirm connects with Shopify (via Shop Pay Installments), WooCommerce, BigCommerce, Wix, and more.
• Marketing Access: Reach Affirm’s network of 6+ million shoppers and test campaigns with built-in A/B tools.

The Downside of Adding Affirm As A Payment Option

Affirm has clear benefits for both merchants and customers, but there are a few financial drawbacks to consider.

• Added Fees: Affirm charges a merchant discount rate plus transaction fees. Rates vary by business size and risk profile.
• Refund Costs: When processing refunds, Affirm does not return the transaction fees you originally paid.

On the plus side, there are no setup, monthly, or annual fees for offering Affirm.

How To Add Affirm As A Payment Option

To get started, complete Affirm’s merchant application. You’ll provide basic business information such as your contact details, website, average order value, annual revenue, and eCommerce platform. Affirm may also request tax and banking details for verification.

Once submitted, you’ll typically receive a response within one to three business days. If approved, you can integrate Affirm into your online store, mobile app, or in-store checkout. Setup instructions are available on Affirm’s website.

Affirm also offers a robust help center, live chatbot support, and customer assistance from 7 AM to 10 PM CT, with responses typically within 24–48 hours.

Affirm Alternatives

Interested in learning about other buy now pay later options? Here are some other top choices, along with our suggestions for the best business types for each.

• Klarna: Best for fashion and luxury purchases
• PayPal Pay In 4: Best for PayPal sellers
• AfterPay: Best for Square sellers
• Sezzle: Best for Gen Z eCommerce
• Sunbit: Best for auto repair shops
• Wisetack: Best for the service industry
• Splitit: Best for high-ticket items

The Bottom Line On Adding Affirm As A Payment Option

Affirm’s short-term, instant loans are part of a growing trend in alternative payments. They’re fast, convenient, and help shoppers who prefer to avoid or can’t access traditional credit.

For merchants, Affirm can boost conversions and average order value, especially if you sell higher-priced products. Even for smaller-ticket items, it gives customers more flexibility with little downside for your business.

That said, Affirm isn’t the only BNPL option. Before you commit, explore other BNPL providers that integrate seamlessly with your eCommerce platform.