Affirm has announced that its savings accounts now offer an annual percent yield (APY) of 1.5%, noting that’s 11.5 times the national average.
That APY became effective as of Wednesday (Aug. 31) and may change at any time, the company said in a Thursday (Sept. 1) blog post.
“When consumers think of Affirm, they largely think of us only as a pay-over-time solution that provides the flexibility to choose bi-weekly or monthly payment options,” Affirm Head of Consumer Product Vinod Ramachandran wrote in the post. “What consumers might not know is that Affirm also offers consumers a way to keep their savings safe and secure while their money earns more money.”
Affirm’s move follows other online banking providers that have been increasing the APYs they offer on savings accounts. As PYMNTS reported Aug. 23, there’s been a “race to the top” in terms of the interest rates.
Affirm debuted its high-yield savings account called Affirm Savings in June 2020 with an APY of 1.3%.
As PYMNTS reported at the time, the alternate payment company said that more than half of Affirm’s user base was made up of millennials and Generation Z, and that these consumers were suspicious of traditional banking services’ fine print and hidden fees.
In January, Affirm announced that its app has become a super app that puts all the company’s shopping, payments and financial services — including savings accounts — in one place.
In the Sept. 1 blog post, Ramachandran wrote that Affirm Savings accounts are available online or in the Affirm app, require no minimums or fees, and are held by and FDIC insured through the company’s partner bank, Cross River Bank.
“Launched in 2020, Affirm Savings serves Affirm’s overall mission to provide honest financial products that improve lives,” Ramachandran said in the post.