What You Need To Know About Adding An Affirm Loan Option To Your Site
How often do shoppers leave your store without completing their purchases? We’re not talking about browsers who look and then leave but about those who put items into their shopping carts and then abandon them there. Those abandoned carts are as a big, flashing warning sign, telling you that you need to find out why customers aren’t completing their purchases, so you can fix whatever’s standing in the way of the sale.
There are a few reasons why your customers might not be completing their purchases, and not all of them are in your control. Certainly, some are casual browsers with no intention to buy right now. Other top reasons include a complicated checkout process, a declined credit card, and extra costs, such as shipping or added fees. And there’s another common cause: not enough payment options. You can simplify your checkout process and make added costs clear upfront. But is there anything you can do to add payment options?
A company like Affirm can knock down price barriers and give customers another way to buy. Add it as an option on your checkout page, and you might be able to entice those shoppers to complete their purchases by offering a simple credit option that lets them buy now and pay later.
Table of Contents
- What Is Affirm?
- Is Affirm Safe?
- How Does An Affirm Loan Work For Your Customer?
- How To Start Offering Affirm For Your Customers
- Requirements A Merchant Must Meet To Offer Affirm Loans
- Merchant Fees To Consider When You Offer An Affirm Loan
- Affirm Loan FAQs:
- Final Thoughts On Adding An Affirm Loan Option To Your Site
What Is Affirm?
Affirm is a loan company offering “buy now, pay later” (BNPL) options. By providing short-term credit, Affirm lets customers spread out payments in a way that suits their budget.
Is Affirm Safe?
Affirm is generally a safe BNPL option for both customers and for merchants. However, buyers should be aware that in general, BNPL options don’t offer the same protections as credit cards, such as zero-liability fraud protection. And some consumers have complained that it can be hard to get a refund via Affirm if an item is returned after purchase.
Still, with 4,310 ratings on Trustpilot, Affirm has 86% “Excellent” and only 9% “Bad” ratings. Most of the negative reviews have to do with the issue of returns and some misunderstandings about making payments. The positive reviews agree that using Affirm as a BNPL option is quick and easy. The company has an A+ rating with the Better Business Bureau.
For merchants, Affirm offers integrations with major eCommerce platforms, including WooCommerce, BigCommerce, and Wix. Recently, Affirm has partnered with Shopify to power Shopify’s native Shop Pay Installments, available only in the US to Shopify customers who use Shopify Payments as their payment processor. Customers who pay for orders using Shopify’s Shop Pay plan will split their total purchase amounts into four equal, biweekly, interest-free payments with no additional fees, including no late charges or hidden costs. Shop Pay adds an additional layer of security for customers, by sending a verification code via text message. Shopify merchants quickly receive the full purchase amount, minus fees, from every transaction, while Affirm handles the duty of collecting payments from customers.

Screenshot of Affirm webpage, captured 9/8/2021
Affirm says that vendors using its BNPL services can expect to see an increase in average order value and a 20% repeat purchase rate. With some 87% of consumers between the ages of 22 and 44 expressing some interest in BNPL services, if you’re looking for a reason to start offering BNPL, you don’t have to look far.
Check out Adding Buy Now, Pay Later To Your Website for an in-depth look at this trend, why it’s catching on, and if can help or hurt your small business.
How Does An Affirm Loan Work For Your Customer?
Let’s say you’re a customer of Joe’s Fun Stuff and you decide you can’t possibly live a moment longer without the hottest new gaming console. Among the usual payment options are cash, credit, and maybe a few digital wallets. But this merchant also provides an option to use Affirm, which allows you to take out a short-term loan, on the spot, to finance the total or partial cost of your purchase. You’re given the choice of paying back the loan over the course of several different term lengths, maxing out at 36 months. Affirm then shows you how much money you’ll be paying in interest, both as a percentage and a dollar amount. It also shows you what your monthly payment will be. If you accept, your purchase is processed. There are no additional fees.
The loan’s APR will range between 0 and 30%. The rate an individual consumer is charged will depend on several factors, including the terms agreed upon between Affirm and the vendor, the term length chosen, and the consumer’s history (both credit history and buying history with Affirm). Affirm says it does not charge late fees.
Applying for Affirm financing requires a shopper to provide their name, birthdate, phone number, and email address. Affirm processes the data and approves or denies the financing almost immediately. Consumers who download the Affirm app can prequalify for purchases with Affirm before they begin shopping. Shoppers who accept the loan terms will receive a virtual “credit card” in the app that allows them to input traditional credit card numbers at point of purchase. The app is available for Android and iOS, and shoppers can use the app to track their loan repayment dates and to make payments securely. The apps are highly rated by users.
Interested in finding other buy now pay later options? Check out Best Buy Now Pay Later Apps.
How To Start Offering Affirm For Your Customers
Affirm boasts that it can boost the average order value (AOV) customers spend when they’re shopping at your store by giving them a way to purchase your products with credit, but at a potentially overall lower cost than they would pay if using a credit card. Affirm lets business owners design a custom program, allowing them to influence the APR (0%-30%) and term lengths (up to 36 months) of the loan your customers will be offered at the point of sale. Payment is settled within one business day.
If that all sounds good, and you’re ready to get started, you’ll need to complete an application with Affirm first. You’ll enter basic information, such as your name, phone number, email, and company name, as well as some specific information that includes your average order value, annual revenue, and eCommerce platform.
After entering that basic information, you’ll be prompted to enter more details, including:
- Incorporated Business Name
- Website URL
- Business Display Name
- Business Type
- Industry
- Sub-Industry
- Annual Volume
- Average Order Volume
- E-Commerce Platform
- Payment-To-Shipment Time
- EIN
- Business Owner Name, Birthdate, & SSN
- Registered Business Address
- State Of Incorporation
- Bank Account Number & Routing Number
Once you submit that information, Affirm promises a response with one to three business days.
Assuming your application is approved, you have choices for how you want to offer Affirm as a payment option for your customers. You can add Affirm to your online store, on your mobile app, as a payment option for in-store purchases, and even for telesales. Detailed instructions are included on Affirm’s website for each option. The website also has a help center, where you can look within categories for help on general topics, or you can type in your own specific question. If you don’t see the self-help answers you need, you can access assistance through a chatbot. Customer support is available daily from 6AM to 5PM Pacific. A response is promised within 24-48 hours.
Requirements A Merchant Must Meet To Offer Affirm Loans
Affirm works with businesses of all sizes, across a range of industries. To be eligible, you must sell directly to US consumers and have a US bank account, a website in English, and prices in USD.
Affirm maintains a list of prohibited products and services. For example, Affirm will not work with companies selling stolen, counterfeit, or unauthorized goods; narcotics, controlled substances, or pseudo-medical products; and firearms, knives, explosives, or incendiaries. Additionally, Affirm declines to work with high-risk companies, explicit or sexually-oriented products, and crude or violent products (or those with crude or violent marketing).
Merchant Fees To Consider When You Offer An Affirm Loan
Merchants offering Affirm to customers are charged a merchant discount rate plus transaction fees. The fee you will be charged depends on a few factors, including your program options, your business size, and your business’s risk profile. According to the website, a typical fee is 5.99% plus $0.30 per transaction, though the company emphasizes that amount can vary by business type and size. Merchants don’t pay integration fees, annual fees, or monthly fees.
Funds from Affirm will be transferred to your bank account via ACH transfer within one and three business days following each transaction. Although your customers spread out the purchase price over a number of months, Affirm pays merchants in full, upfront. Issuing a refund on an Affirm order is similar to processing a credit card refund. Affirm does not refund the fees you paid on each transaction.
Affirm says its customers can see up to an 85% increase in average order value, along with a 20% repeat purchase rate. Merchants using Affirm also can access Affirm’s tools, allowing you to market through their customer network, containing 6.2+ million shoppers, as well as try out different sales strategies through programmatic A/B testing.
Affirm may be a strategy worth trying, particularly for merchants who have been struggling to reduce shoppers’ rate of abandoned carts.
Affirm Loan FAQs:
Final Thoughts On Adding An Affirm Loan Option To Your Site
POS loans like those offered to consumers by Affirm fit into the broader trend of alternative lending: They are fast, easy, and increasingly popular. Above all, they provide options for borrowers who have a hard time otherwise accessing credit or those who wish to avoid credit cards’ minimum payment trap.
Is it worth incorporating Affirm into your business? If you’re selling relatively expensive items, there’s a pretty good chance that Affirm will have a positive effect on your sales. Most of Affirm’s testimonials come from businesses that sell at least some big-ticket items.
On the other hand, businesses selling relatively inexpensive goods can probably safely stick to cash and card-based payments, with support for digital and mobile wallets if you’re so inclined.
Of course, Affirm is far from the only company offering POS loans to consumers. If you’re already using Square, for example, take a look at Square Installments to see if that might be a better fit for your business. If you’re using another of the most popular eCommerce platforms, you might find a different POS option that works well with your online store.
And of course, if you’re a business owner that prefers old-fashioned payment methods like credit cards, why not take a look at our business credit card comparison chart? Need help navigating all these new payment systems? Check out The Small Business Owner’s Guide To Alternative Payments.