Affirm Faces Regulatory Shake-Up with New CFPB Rules

Affirm Holdings Inc AFRM faces regulatory changes as the Consumer Financial Protection Bureau (CFPB) plans to extend credit card protections to the “buy now, pay later” (BNPL) industry.

The CFPB’s interpretive rule, effective July 30, mandates that BNPL firms offer dispute resolution, refunds for canceled purchases, and regular billing statements similar to those required for credit card customers.

A trade group representing BNPL companies, including Affirm, has requested a delay in implementing the rule, which aims to align consumer protections across financial sectors, Bloomberg Law reports.

Also Read: Affirm Partners with RONA to Offer Buy Now, Pay Later Options in Canada

Affirm Holdings, which gained 88% in the last 12 months, has had its share of challenges this year.

Earlier in July, the company disclosed a cybersecurity breach, stemming from an incident at Evolve Bank and Trust in Arkansas.

The personal information of Affirm card users was compromised and appeared on the dark web following the breach last week. Evolve Bank confirmed the incident with Reuters but assured them Affirm’s systems remained secure.

Investors can gain exposure to Affirm Holdings through Vanguard Small-Cap ETF VB and Vanguard Total Stock Market ETF VTI.

AFRM Stock Prediction For 2024

An investor can make a few decisions when deciding whether a stock is a good buy. In addition to valuation metrics and price action which you can find on Benzinga's quote pages – like Affirm Holdings‘s page for example – there are factors like whether or not a company pays a dividend or buys a large portion of its stock each quarter.

These are known as capital allocation programs. Affirm does not pay a dividend, but obviously has a few ways it can return value to shareholders. Feel free to search Benzinga's dividend calendar for the next company that is due to pay a dividend and determine what kind of yield you can earn for holding a share of the company.

For example, if you're looking to earn an annualized return of 12.72%, you'll need to buy a share of Dynex Cap by the Jul. 23, 2024. Once done, you can expect to receive a nominal payout of $0.13 on Aug. 1, 2024.

Buyback programs are obviously different and highly variable. A company can approve a buyback program and purchase shares as it sees fit over the course of time in which the buyback was authorized. Looking through the latest news on Affirm Holdings will often yield whether or not the company has approved a buyback program recently. Buyback programs usually serve as a support for share prices, serving as a backstop for demand.

Price Action: AFRM shares were trading higher by 1.53% at $32.59 at the last check on Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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