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Investing.com -- Shares of Affirm (NASDAQ:AFRM) climbed 2.7% Wednesday, buoyed by the announcement of a significant partnership with Costco Wholesale Corporation (NASDAQ:COST), the world’s third-largest retailer. The collaboration designates Affirm as a pay-over-time provider for Costco.com in the United States, enabling online shoppers to finance purchases above $500 with transparent payment plans.
The alliance, effective immediately, allows Costco members to opt for Affirm’s payment options at checkout, promising no late or hidden fees. This move caters to the consumer behavior observed in fiscal year 2024, where Costco saw approximately $250 billion in sales from both in-store and online platforms. Affirm’s payment plans, which cover amounts from $500 to $17,500, come with clear pricing and credit terms, including APR discounts, to facilitate larger purchases.
Affirm’s SVP of Revenue, Pat Suh, highlighted the seasonal relevance of the partnership, noting an uptick in consumers seeking financing for summer-related goods such as outdoor furniture and appliances. Suh expressed enthusiasm for providing Costco members with a non-traditional credit option that aligns with their preference for strategic spending and bulk purchases.
This strategic partnership is expected to support Affirm’s growth by tapping into Costco’s substantial customer base and reinforcing the payment network’s position in the competitive pay-over-time market. The collaboration is set to offer a mutually beneficial arrangement, expanding payment flexibility for Costco’s customers while potentially driving increased sales and customer loyalty for both companies.
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