Affirm drops as report suggests Walmart-backed fintech One to introduce BNPL services

Affirm Holdings (NASDAQ:AFRM) slipped in premarket trading on Tuesday after a CNBC report suggested that Walmart (WMT) backed fintech startup One has started offering buy now, pay later loans at some of the retailer’s stores in the U.S.

The development pits One against Affirm, which has an agreement to be the exclusive provider of installment loans for Walmart customers since 2019.

Affirm (AFRM) was trading 7.34% lower to $29.35 in premarket trading.

The move also worries Affirm investors that Walmart might push third parties like Capital One (COF) and Affirm outside the reach of its customers.

The report suggested that signs prevail indicating that One’s push into leading is going to go beyond installment loans.

Reacting to Affirm’s stock move, Mizuho said that this is not new news and headlines like these end up being buy opportunities for the stock.

“AFRM’s TAM is in the trillions, so WMT supporting BNPL expands TAM and visibility of the category,” said Mizuho analysts.

Last year, Walmart won a legal dispute with Capital One, which allowed the retailer to terminate its credit card partnership years ahead of schedule, alleging failures around customer service obligations.

On the other hand, Capital One itself alleged that Walmart’s reason behind the termination was less about servicing complaints and more about moving transactions to a company it owns.

Walmart has not disclosed the size of its investment in One.