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A New York woman accuses Affirm Holdings, Inc of tricking consumers into purchasing more, and paying high fees later, with “buy now, pay later” (BNPL) payment plans, in a class action lawsuit lodged Monday.
Lead plaintiff, Judith Shephard, wants to represent other New York consumers who were allegedly duped into Affirm BNPL payment plans that encourage higher spending and make returns tricky. She says the company’s practices violate New York consumer protection laws.
Shepard says that she relied on Affirm’s marketing when deciding between the company’s BNPL payment plan and using a traditional credit card to make certain purchases. She says that, as a result of Affirm’s deceptive marketing, she was hit with excessive fees. She also claims that the company failed to protect her interests in disputes with merchants participating in its BNPL payment plans.
Affirm offers reverse “layaway” payment plans that “encourages spending on items that otherwise could not be afforded,” explains the class action lawsuit. Under the plans, customers buy something and are then required to make payments until they have paid off that purchase.
Affirm partners with retailers and encourages spending on trendy clothing and jewelry, says the class action lawsuit. Shepard claims that Affirm’s “buy now, pay later” promises result in payments that are hard to track, resulting in high fees for consumers.
In addition, Affirm is unable to provide refunds, making it difficult for consumers to return defective items to the retailer, points out the plaintiff. Consumers who return items are still required to make installment payment to Affirm, alleges Shepard, and do not have the option to dispute the transaction as they would with a credit card company.
“Affirm touts itself as an alternative to ‘traditional’ lenders like credit cards, payday loans and banks,” states the class action lawsuit pointing out that the company targets millennials who mistrust credit cards. “However, the interest rates charged through Affirm exceed most credit cards, without any of the protections of this regulated form of payment.”
The class action lawsuit accuses Affirm of negligent misrepresentation, unjust enrichment, and violating New York general business law.
Shepard wants to represent other New York residents who made purchases using Affirm BNPL payment plans. She wants Affirm to pay damages to Class Members and stop its allegedly illegal marketing and payment plan practices.
Have you used Affirm payment plans to make a purchase? We want to hear from you! Tell us about your experience in the comment section below!
The lead plaintiff is represented by Spencer Sheehan of Sheehan & Associates, P.C.
The Affirm Deceptive Payment Plans Class Action Lawsuit is Shepard v. Affirm Holdings, Inc., Case No. 7:21-cv-05241 in the U.S. District Court for the Southern District of New York.
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304 thoughts onAffirm ‘Buy Now, Pay Later’ Payment Plans Dupe Consumers, Says Class Action Lawsuit
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Please add me. I used affirm to purchase to for multiple purchases and was surprised by the fees I incurred, when I paid off the balance early.
I made a purchase for jewelry and used Affirm for payment. The jewelry ordered was not what was pictured. So twice I had to send the necklace back for an exchange. Well, I never got the necklace but Affirm expected me to still pay for the first 2 necklaces anddddd continue to pay on the 3rd necklace that I never received. Refused to dispute with the jewelry company plus I have text messages between the jewelry company and I that I was supposed to get an exchange. Affirm still charged me for 3 necklaces, never got a refund then turned my account over to collections and filed on my credit report. Can I please get in on this lawsuit?
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I returned and item from Walmart on The Tv and a wall mount for a week looking for my credit. Walmart sent the credit to Affirm but the credit never hit my Affirm account im still paying as of today
Add me Please!
They are definitely a rip off, even if you pay off early they still charge you interest
Add me please!
I’ve been waiting on a $55 refund from them. They don’t answer emails, they don’t answer calls, and they don’t answer fb messenger. IF they do and you respond, they disappear on you. They’re so quick to take my money, but when it’s time for them to give me a refund, they’re nonexistent!!!
I live in Arizona and am currently trying to get a $76 refund from a purchase from Walmart using Affirm. I received an email from the seller and Walmart stating I would receive a refund. I have contacted Affirm four times in the past few weeks but I still do not see a refund applied to my account with Affirm. I did provide them with the emails from Walmart and the seller.