PayPal Co-Founder Max Levchin Launches mCommerce Firm
PayPal co-founder Max Levchin has launched a new mCommerce firm, Affirm, which offers a quick and simple online check out process. "Affirm argues that the online checkout experience has not improved for shoppers in more than a decade, meaning merchants are left with countless abandoned carts," according to Finextra. Affirm will use Facebook to authenticate customers at the checkout, Levchin told AllThingsD, before guaranteeing the merchant payment, for which it gets a fee.
Stripe — in which Levchin is an investor, too — will be processing credit card payments on the back end, AllThingsD.com reported.
Finextra added: "Acting as a digital charge card, Affirm then gives the customers 30 days to settle the bill, although it does not charge them for this."
"You will essentially be putting a purchase on a digital tab, and we are going to make it work for us by looking at all available data to determine if you are someone who will pay it back," says Levchin.
Affirm’s beta launch partner is 1-800-Flowers.
Read the full story here and here.
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Fred Wilson:
From the Terms on Affirms site below. Do they plan on notifying your facebook friends that you are 20, 10 and 5 days from payment due date? Why no fee direction? Technically are you even legally bound to pay this pack? Is this revolving credit or like a charge card? I hope Affirm has a great fraud and risk team or this is going to burn cash fast. is Affirm 100% liable to merchant for loss or do you think there is a shared liability? It is interesting to see facebook data being used as a vetting tool in payments...
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You also agree that if you ever have overdue payment, Affirm may engage in collection efforts to recover such amounts from you. These collection efforts may involve contacting you directly, submitting your information to a collections agency, or legal action. FAILURE TO PAY MAY AFFECT YOUR CREDIT SCORE.
SHOULD YOU FAIL TO PAY, AFFIRM MAY UNILATERALLY DECIDE TO IMPOSE REASONABLE FEES ON YOUR ACCOUNT, INCLUDING BUT NOT LIMITED TO, THE COST OF COLLECTIONS OR OTHER LEGAL ACTIONS AND PUNITIVE FEES IN EXCESS OF OUR INCURRED COSTS.