Over the programme term through June 2027, LMI will purchase Affirm’s instalment loans on a forward flow basis, in amounts of USD 750 million outstanding. Over time, LMI expects to invest up to USD 5 billion in the programme.
Through the programme, Affirm gains a partner who provides capital to increase access to its payment options. The two companies began their capital partnership in 2019, followed by their forward flow loan purchase programme in 2023.
Affirm’s vision is to deliver honest financial products that improve lives. This is premised on driving positive credit outcomes, having access to deep and diverse pools of committed capital, and leveraging partnerships across its network. The company highlighted the importance of deep and diverse capital sources and strong partnerships in advancing its growth plans.
Additionally, LMI’s ability to invest across the capital structure with a single-client focus allows it to provide solutions and scale to its long-term partners.
As an underwriter, Affirm offers simple solutions for merchant partners and access to transparent and flexible financing options for consumers, creating risk-adjusted assets. The company is known for providing payment options for consumers, which also creates risk-adjusted assets for merchants. It has a diverse funding model that includes warehouse facilities, forward flow agreements, and asset-backed securitisations.
In 2024, the company expanded its collaboration with Adyen to extend its reach to Canadian merchants. Additionally, Canadian customers gained access to Affirm’s monthly instalment option, alongside the existing bi-weekly plan. Affirm allows approved customers to select payment terms ranging from six weeks to 36 months, with interest rates as low as 0% APR and no late or hidden fees.
Another partner Affirm acquired in December 2024 is Sixth Street. The company invested USD 4 billion by purchasing Affirm loans in a secure and efficient AssetCo structure pursuant to a three-year, forward flow agreement. The capital will offer flexibility, commitment, and alignment from both partners and will also provide additional off-balance sheet funding.
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