Is Affirm Legit?

You might have seen Affirm advertised at a numerous retailers while shopping online. Affirm seems to be everywhere these days and checkout and shopping carts are likely reminding you all the time. Is Affirm legit? Or a scam? Let’s explore.

Is Affirm Legit?

Yes, Affirm is a legit company and is a pioneer in the emerging Buy Now Pay Later (BNPL) industry. Something that we cover exclusively here on DimeScout.

Affirm was founded in 2013 by veteran tech entrepreneur Max Levchin. What Levchin is best known for is the online payments company PayPal. Levchin is part of the “PayPal Mafia” along with Elon Musk and venture capitalist Peter Thiel.

Levchin actually conceived of the idea for Affirm because of his own personal experience with bad credit when trying to purchase a convertible. Even though he was a millionaire from taking PayPal public and eventually selling the company to eBay, bad credit from when he was in college still affected him, even as a tech billionaire. Crazy huh?

BNPL makes more sense that credit cards since the interest doesn’t compound. Something that Levchin found was predatory and harmful to consumers. He set out to change the lending industry with Affirm.

Affirm BNPL Services

Affirm offers BNPL loans to consumers that are can be paid in installments, usually 4 payments over a few weeks. For larger purchases you can spread payments out monthly without interest under a certain period of time, typically 6-months or less. Often for loans of 12-months small interest will incur on the Affirm loan.

While most of Affirm’s loans are done using the Affirm app or online with a retailer or merchant, a growing number are using Affirm for in-store purchases. Affirm offers is an actual Affirm card that allows consumers to make purchase in-store hassle-free with Affirm.

Affirm does charge interest on some loans as mentioned above. The majority of the originating loans from Affirm do not charge interest though. So how does Affirm make money?

The merchant where you bought an item from pays for the privilege for you to use Affirm. This makes sense for the retailer since they get to make a sale that they likely would not have. You get the advantage of getting the product that you wanted now instead of later, hence why we call it Buy Now Pay Later.

Affirm now has millions of customers and merchants and is also a publicly-traded company that is listed on the NASDAQ stock exchange. You can look-up Affirm with the ticker symbol AFRM.

As with any loan or financial service, make sure you understand what you are getting yourself into and that you can make the Affirm installment payments on-time. I’ve personally used Affirm many times without any issues and they are a highly regarded BNPL company.