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BNPL player Affirm enters the UK market to compete against Klarna and Zilch

Affirm
Picture credits: Affirm

Affirm, one of the popular players in the Buy Now Pay Later (BNPL) market, has forayed into the UK. The company headquartered in the US has made its entry into the new market as the UK government announced new rules to regulate the booming BNPL market. 

These new rules will come into effect in 2026 and require BNPL firms to carry out affordability checks on users before they provide a loan. 

New market entry by Affirm

The company’s expansion to the UK adds to its presence in the US and Canada. This will enable Affirm to further build upon its growing network of 50 million consumers and over 300,000 active merchants worldwide, including brands such as Amazon, Shopify, Walmart, and many more. 

In the UK, Affirm will initially offer its interest-free and interest-bearing monthly payment options. Any interest applied will be fixed and calculated solely on the original principal amount, meaning the amount of any interest does not ever increase or compound. Consumers will always know what they owe upfront. This service is authorised and regulated by the Financial Conduct Authority. 

In the future, the company might bring further products to the market, including the physical payment card, which is available in its home market. 

Poppy Gustafsson, Minister for Investment, commented: “We are proud to have Affirm establish a presence and open for business in the UK. Their substantial investment will not only help create tech-savvy jobs but underscores their confidence in the UK economy. This government is laser-focused on supporting business growth and expansion. The UK market offers a range of exciting opportunities, helping companies diversify their offerings and revenue streams, and making the UK one of the most innovative economies in the world.”

Niall Mackenzie, His Majesty’s Trade Commissioner for North America, said: “We are proud to have Affirm bring its world-class financial payments platform to UK consumers. Their convenient and transparent credit offering – trusted by millions of consumers in the US and Canada – will offer UK consumers more payment choice and flexibility and help retailers better serve their customers. Affirm’s investment in the UK and commitment to hiring a tech-savvy workforce underscores their confidence in our economy, and we look forward to partnering with them as they continue to invest, grow and expand in the UK.”

Partners in the UK

It was launched in the UK with Alternative Airlines, a flight booking site, and Fexco, a global fintech and payments processor, with additional UK and international brands expected to follow. 

As a result, eligible Alternative Airlines customers can now select Affirm at checkout, go through an eligibility check, and if approved, select from Affirm’s monthly payment plans for their flight purchases. Additionally, Fexco’s international clients with a UK presence can easily integrate this fintech platform and offer it as a payment option to their customers at checkout.

Brian Cleary, CEO, of Fexco OpenConnect, shared: “We are thrilled to expand our partnership with Affirm to serve our UK partners. Their leadership in the travel sector, technological expertise, and capacity to serve a broad range of transactions make them uniquely suited to serve our network of premier cruise lines. Additionally, their customisable terms and steadfast commitment to never charging late and hidden fees, like compound interest, ensure that our partners can fully benefit from Affirm’s consumer-centric approach. We look forward to working with Affirm to empower more travellers to enjoy memorable experiences.”

Sam Argyle, Managing Director of Alternative Airlines, said: “At Alternative Airlines, we believe that everyone should have the freedom to fly—whether it’s for a dream vacation, an important family gathering abroad, or a last-minute break. Affirm’s user-friendly, seamless experience helps to enable just that, while ensuring people access credit responsibly. Consumers demand payment choice, flexibility and transparency at checkout, and Affirm delivers all three. Over the last five years, we’ve seen the value that Affirm delivers to our U.S. travellers, and more recently with our Canadian travellers. We are incredibly excited to offer Affirm’s personalised payment options in the UK.”

What does the company do?

Founded by Jeffrey Kaditz, Max Levchin, and Nathan Gettings in 2012, Affirm’s mission is to build honest financial products that improve lives. The company offers approved consumers an alternative to credit cards and other pay-over-time options, providing the ability to split the total cost of purchases into budget-friendly payments. 

Already, the UK market has several BNPL players such as Klarna and Zilch. With the entry of Affirm, there will be fierce competition in this segment. What makes it better is that Affirm will underwrite every single transaction and not charge late fees in the UK while Klarna charges late fees since last year. 

Max Levchin, Founder and CEO of Affirm, commented: “Affirm was founded on the premise of putting people first and empowering consumers to take greater control over their finances. Building on our leadership in the US and Canada, where we partner with top retailers and commerce platforms, we see a significant opportunity to extend our mission of building honest financial products to the UK. We know that UK consumers are savvy shoppers who appreciate upfront, no-nonsense products. We look forward to offering them responsible credit options that truly put consumers first and working collaboratively with our UK partners to demonstrate how honest finance is good business.”

Ruth Spratt, UK Country Manager of Affirm, added: “There are many brilliant businesses in the UK that make this country what it is – and we can’t wait to start working with them. The UK’s open economy, mature consumer market, and world-class talent makes it the perfect place for the next phase of Affirm’s journey. By entering the UK alongside a leading travel provider and platform partner, we’re able to expediently and deliberately begin growing Affirm’s UK network of consumers and merchants. We look forward to continuing to expand in the coming months.”

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