WooCommerce, an open-source commerce solution built on WordPress, reported last Friday that they had chosen Affirm as the default BNPL (buy now, pay later) payment provider. Now, merchants using WooPayments at the checkout, an integrated payment service by WooCommerce, can instantly offer Affirm “pay-overtime” plans to their customers. This move will make Affirm the leading BNPL payment option in the US and Canada.

Additionally, WooPayment merchants could offer Affirm’s monthly, bi-weekly, and newer payment options like “Pay in 30.” This will potentially enhance the reach of Affirm, with strongholds on small and medium businesses, all while helping the merchants to offer their customers Affirm payments on different ranges of transactions. This will not only boost customer satisfaction but will also result in increased sales.

Key Takeaways

• Affirm Becomes Default BNPL Provider for WooCommerce: To expand their current payment infrastructure and offer better payment flexibility, WooCommerce has decided to make Affirm the default payment provider. This decision will ensure customers pay the bill in parts without any late fee charges, providing better transparency for shoppers.
• Positive Impact on Small and Midsize Businesses: With this partnership, merchants can capture a more extensive customer base (like GenZs) adopting BNPL services, increasing average order value.
• Rising Adoption of Affirm by WooCommerce Merchants: This strategic partnership occurred due to merchants’ growing adoption of Affirm as a payment option. For instance, in 2023, there was a 45% increase in WooCommerce merchants adopting Affirm.
• Businesses Are Welcoming the Decision: Established merchants on WooCommerce are happy with this new partnership as they see better growth after offering Affirm pay-overtime. For example, Benjamin De Castro, chief marketing officer at Gardyn, mentions that Affirm provides what the customer values – transparency, flexibility, and choice at the checkout. With Affirm, Benjamin said they can offer customers a “best-in-class” checkout experience. 
• Affirm’s Strategic Growth and Partnerships: Affirm’s collaborations, including integration with Adyen for Platforms and a capital partnership with Sixth Street, aim to expand its market reach. The company targets $34 billion in gross merchandise value (GMV) by fiscal 2025.

WooCommerce Makes Affirm the Default BNPL Provider to Enhance Payment Flexibility and Merchant Growth

WooCommerce, a leading open-source e-commerce platform built on WordPress, has made Affirm its default BNPL provider for WooPayments merchants. WooPayments merchants will now have greater payment flexibility and ensure enhanced checkout transparency. It will also mean shoppers can make a wide range of transactions in smaller monthly installments.

With Affirm, merchants have a distinct edge in the competitive market. Affirm does not charge any late fees in case of missed payments, unlike other BNPL providers like Afterpay, which charges as much as 25% of the total transaction value.

The collaboration between WooCommerce and Affirm is not new but has evolved significantly. The recent upgrade to make Affirm the default BNPL option on WooCommerce platforms is a strategic move to enhance e-commerce operations by integrating more seamless and flexible payment solutions.

This decision is expected to impact positively small to midsize businesses by expanding their customer base and increasing average order values, as merchants have reported a noticeable increase in transaction sizes when customers use Affirm compared to other payment methods.

Affirm’s commitment to transparency and no hidden fees aligns with consumer preference for straightforward, honest financial products. This approach helps build customer trust and empowers them to make informed purchasing decisions without fearing unexpected charges.

Web Griebel, the Head of Payments at Woo, announced the expansion of their collaboration with Affirm, noting it comes at a pivotal time when consumer interest in clear and flexible payment options is at a peak. This year alone, there has been a 45% rise in merchants adopting Affirm’s services on WooCommerce. Merchants using Affirm also report higher average order values than those not using the service. Griebel enthusiastically advocated advancing this partnership to support merchant growth through Affirm’s solutions.

By becoming the default payment method on WooPayments, Affirm now reaches thousands of WooCommerce merchants, broadening its presence across various online businesses. The introduction of Affirm’s “Pay in 30” option, alongside its existing payment plans, allows it to appeal to a broader range of consumers, including those with smaller purchases.

As Affirm is increasingly adopted by WooCommerce merchants, the transaction volume on its platform is expected to increase, which should boost its revenue. This growth also strengthens Affirm’s position as a reliable BNPL service. Additionally, Affirm has expanded its partnership with Adyen, becoming the first BNPL service integrated with Adyen for Platforms, and has formed a significant capital partnership with the global investment firm Sixth Street.

Wayne Pommen, Chief Revenue Officer at Affirm, expressed enthusiasm about deepening their relationship with WooCommerce by becoming a default payment choice for thousands of its merchants. He highlighted this development as a significant opportunity for Affirm to increase its presence, particularly among small and mid-sized businesses, and offer transparent financial products to a broader customer base.

With over 320,000 partners worldwide, these strategic alliances are likely to help Affirm meet its ambitious goal of surpassing $34 billion in GMV by fiscal 2025. The company also projects an increase in its revenue relative to GMV by at least 20 basis points from fiscal 2024.

About Affirm

Affirm Holdings, Inc. operates a payment network in the United States, Canada, and other countries. The company offers a platform that includes a point-of-sale payment system for consumers, solutions for merchant commerce, and a dedicated app for consumer use. Its commerce system, in partnership with originating banks and capital markets partners, allows consumers to purchase installment payments.

Affirm has a diverse range of active merchants, from small businesses to large corporations, including direct-to-consumer brands, traditional retail stores, and companies with an omnichannel strategy. These merchants span various industries such as home and lifestyle, sporting goods, electronics, travel, automotive equipment, fashion, and general retail. Founded in 2012, Affirm Holdings, Inc. is based in San Francisco, California.

About WooCommerce

WooCommerce is a recognized company that develops an open-source eCommerce plugin for WordPress. Founded in 2008 and based in San Francisco, CA, the company operated as WooThemes and shifted its focus entirely to eCommerce solutions in 2017. The adaptable platform allows small to medium-sized businesses to create customized online stores tailored to their specific requirements. WooCommerce supports the sale of physical and digital goods, including subscriptions and appointments, through a modular system that can handle a variety of commercial activities.

WooCommerce has a notable role in the eCommerce industry and is praised for its extensive customization options and robust support network. It offers sophisticated selling tools and committed assistance, aiding established merchants in expanding their operations. The platform enables users to begin at no initial cost, with a scalable architecture that can expand alongside the business. This strategy has established WooCommerce as a reliable option among eCommerce platforms, constantly adapting to satisfy the varied demands of its users across multiple sectors.

Conclusion

The integration of Affirm as the default BNPL provider for WooCommerce marks a pivotal advancement in the e-commerce payment landscape. This collaboration aligns with growing consumer demand for transparent and flexible financial solutions while supporting merchants in boosting sales and attracting a broader customer base.

By offering payment options like “Pay in 30” and eliminating late fees, Affirm enhances the checkout experience and fosters trust among users. With its strategic partnerships and commitment to innovation, Affirm is well-positioned to expand its market reach and achieve its ambitious growth targets. Similarly, WooCommerce continues strengthening its reputation as a leading platform for adaptable and customer-focused e-commerce solutions, benefiting merchants and consumers.