Apple Pay BNPL Integration Changes Mobile Payments Forever

Reviewed by Corey Noles

Apple's move to fold buy now, pay later directly into the iPhone Wallet app is one of the biggest shifts in mobile payments since Apple Pay launched. What began as Apple Pay Later in 2022 has turned into something more strategic, a rethink of payment flexibility on our phones. The compressed timeline says plenty about how Apple enters new markets, they experiment fast and pivot faster when a better path appears.

The rise and fall of Apple Pay Later

Let’s break down what actually happened with Apple’s first BNPL attempt, because the timeline is pretty wild. Apple Pay Later was announced at Apple’s 2022 Worldwide Developers Conference, promising to let users split purchases into four equal payments over six weeks, with no fees and no interest if paid on time. The maximum amount per purchase was $1,000, and, in classic Apple fashion, the financing was handled by Apple Financing LLC.

Here’s the kicker. Apple Pay Later did not begin rolling out until April 2023, and it took another six months to reach everyone in the US. Nearly two years from announcement to full availability. Then, six days after announcing third-party BNPL integration, and less than a year after the full US launch, Apple said Apple Pay Later was done. Blink and you missed it.

Why pull the plug on something that worked in practice? Apple recognized a strategic truth, they did not need to be in the lending business when they could build the platform others plug into. Step back from direct competition, double down on what they do best, creating a great user experience rather than running a bank.

Third-party integration, the real game changer

Apple’s pivot to third-party BNPL providers is where things get interesting. In iOS 18, the option that used to tie into Apple Pay Later instead offered BNPL loans through Affirm and Klarna. Not a simple swap, a strategy shift that turns Apple from lender to platform orchestrator. Apple opened BNPL integration to more experienced financial services companies, letting Affirm and Klarna handle the lending heavy lifting.

The reach goes beyond the US. Klarna expanded into Canada and the UK, and Apple added ANX in Australia, CaixaBank in Spain, and HSBC and Monzo in the UK. Plus, Apple also promised Citi, Synchrony, and Fiserve issuers would be coming to the US.

What makes it sing is how it feels for users. On iPhone and iPad with iOS 18, shoppers can choose Klarna when paying online or in-app with Apple Pay. The flow is clean, select "Other Cards & Pay Later Options" at checkout, pick Klarna, then authenticate with Face ID or Touch ID.

This model lets Apple lean on established lending expertise while keeping the experience unmistakably Apple. Instead of competing on risk models and interest terms, they focus on making the payment itself feel native to the ecosystem.

What this means for the Apple ecosystem

This is bigger than an extra button at checkout, it fits Apple’s ecosystem playbook. Consider this, Apple Pay accounts for approximately 35% of non-cash point-of-sale transactions in certain advanced markets in Europe. With that kind of penetration, Apple can offer flexible payments without taking on the regulatory complexity of lending, and still reap the engagement benefits that come from keeping users in Wallet.

Timing helps. BNPL is expected to become a common feature in digital wallets globally, and 70 percent of BNPL users say they would prefer the solution if it came from their primary financial institution. For many iPhone owners, Apple Pay already feels like that primary option. BNPL is increasingly preferred, especially by younger consumers, and the integration puts it right where they already shop.

Apple also keeps the trust equation intact. Apple Pay is known for tokenized transactions that protect user information, and Klarna’s privacy-focused approach keeps transaction history secure while Apple’s privacy features remain intact.

PRO TIP: If you already use Apple Pay, watch for BNPL options at checkout. The rollout is gradual, and when they appear, Face ID or Touch ID makes them feel like they were there all along.

The bigger picture, Apple’s payment platform evolution

BNPL is one tile in a larger mosaic. Apple is expanding access to NFC, often under regulatory pressure, improving Wallet, and deepening ties with financial institutions around the world. The move positions Apple as more than a payment facilitator, it turns Wallet into a hub that connects users with best in class services.

It mirrors Apple’s broader platform play. Build the ecosystem and the experience, then pair with specialists for complex services. Think iCloud for storage, Google for search placement, and now established BNPL providers for lending. Rather than fight every battle across every vertical, Apple orchestrates the integration and makes it feel seamless.

It also shows a maturation in how Apple approaches financial services. A full platform does not require mastering every financial product. Focus on user experience and ecosystem glue, partner where depth is needed, and you can ship more sophisticated solutions than you could alone.

The takeaway, Apple has shifted from owning every piece of the payment stack to becoming the indispensable connector that brings the best tools to the user. Not just payments, a financial ecosystem that runs on clean integration instead of direct service provision.

Bottom line: Apple’s shift from a standalone BNPL product to an integrated ecosystem feature explains why it continues to dominate mobile payments. By partnering with established players rather than doing everything in house, Apple delivers a seamless, secure, flexible experience that keeps users inside the Apple ecosystem while giving them access to strong financial tools. This pivot from direct competition to platform orchestration positions Apple as the hub that makes financial interactions feel effortlessly Apple like.