Affirm

Affirm originates fixed-rate, fully amortizing installment loans that carry no late fees, no deferred interest, and no compounding penalties. Klarna and Afterpay offer merchant-funded zero-interest short-term receivables, often relying on late fees and merchant discount rates — a model Affirm publicly rejects as misaligned with borrower outcomes.

Yes. Affirm retains credit exposure on a substantial portion of its originations, funding loans through warehouse facilities, whole-loan sales, and securitizations. Its quarterly filings break out the composition of its loan book, gain-on-sale margins, and the credit performance of retained tranches.

Peloton was a major 0% APR financing partner during 2020–2021, with Peloton orders representing a material share of Affirm's gross merchandise volume. That concentration unwound as Peloton's sales decelerated, and Affirm has since diversified its merchant base across general retail, travel, and ticketing.

Credit risk and underwriting strategy sit under the CEO, Max Levchin, with day-to-day management led by the Chief Risk Officer — a function Affirm reports in its proxy as a named executive. Levchin personally reviewed early credit models and remains closely involved in risk appetite calibration.

Max Levchin co-founded PayPal in 1998 as the company's CTO, and Affirm incorporates aspects of PayPal's technical talent pipeline and payments infrastructure understanding — but the two are legally and structurally separate. PayPal operates its own buy now, pay later product that competes directly with Affirm's loan product.