Affirm's CEO says AI shopping assistants may steer you to 0% loans

Affirm CEO Max Levchin says AI shopping assistants may nudge people toward 0% installment loans. These are plans that split a purchase into payments without adding interest. "I expect 0% volume to go up a lot in agentic," he told analysts on Thursday, Nov. 5. "Agentic" means an AI that shops and buys on your behalf.

Why agents may favor 0% plans

Levchin said an agent comparing payment options could steer shoppers to loans that spread out the price without extra cost. Interest-free plans made up 28% of Affirm's gross merchandise volume, meaning the total value of purchases, in the September quarter. Interest-bearing loans made up 72%.

Many of those 0% deals are paid for by brands. About 1 million products in the Affirm app carry such promotions, where a manufacturer covers the cost of an interest-free loan on a specific item sold through a retailer. Affirm is building tools that could let a seller's AI agent offer one of these deals to a shopper's agent.

Not every shopper wants 0%

Levchin added that some people on tight budgets could still prefer a longer loan with interest if it brings the monthly payment within reach. An agent that only looks for the cheapest total cost might miss that trade-off.

The warning signs

Levchin was blunt about the risks. "Generally speaking, you can expect AI commerce to be more than a little bit messy," he said. He pointed to agents buying things consumers did not want, and to fraud. He did not say who would be responsible if an AI agent is involved in fraud.

Borrowers falling behind also came up on the earnings call. The share of U.S. loan balances at least 30 days past due rose to 2.9% in September, excluding short-term Pay in X and Peloton loans. That was up 35 basis points from June, or 0.35 percentage points, and nine basis points from a year earlier. Levchin blamed much of the rise on seasonality and said short loan terms limit Affirm's exposure.

The business behind it

• Revenue rose 35% to $1.3 billion, above analyst estimates.
• Purchase volume rose 34% to $14.4 billion.
• Active consumers rose 19% to 28.7 million.
• Affirm Card spending more than doubled to $3.3 billion, with 6 million active cardholders.

Shares fell more than 9% in after-hours trading, after losing nearly 8% during the regular session. Analysts questioned the rise in late payments.

What happens next

Affirm plans to introduce card-specific financing offers this quarter and to pilot Edge, which would offer its installment loans through other issuers' debit cards. The company's fiscal 2027 outlook calls for at least 30% growth in purchase volume. How AI agents will actually choose payment plans, and who pays when they get it wrong, is not yet settled.