Affirm Expands to the U.K. Amid Regulatory Changes in Buy Now, Pay Later Market

Affirm has officially entered the U.K. market, marking its first expansion beyond North America. This move comes as U.K. lawmakers consider new regulations for the buy now, pay later (BNPL) sector, expected to take effect by 2026. The timing provides Affirm an opportunity to establish its presence with consumers and regulators.

Founded by Max Levchin in 2012, Affirm has grown significantly, entering Canada in 2022 and partnering with major e-commerce platforms like Shopify and Walmart. The BNPL model allows customers to make purchases on credit, repaying over time without interest, although it has faced scrutiny for potentially encouraging debt.

The U.K. government is currently reviewing BNPL practices to ensure transparency and consumer protection. Affirm is positioning itself as a responsible option, pledging no late fees and fixed interest rates on loans.

Despite recent challenges in the BNPL sector, including a sharp decline in Klarna's valuation, Affirm has seen a resurgence, reporting a 48% revenue increase in Q4 2024. While it launches in the U.K. without its major U.S. partners, the company is already working with platforms like Alternative Airlines and Fexco, and plans to grow its local workforce as it expands its offerings.