In-house machine learning that underwrites every purchase in real time, now on a transformer model, plus an engineering organisation retooled around coding agents and a push to put pay-over-time inside AI shopping agents.
How is Affirm using AI?
Affirm's AI strategy centres on in-house machine learning that underwrites every purchase in real time. On September 17, 2026 it put a transformer-based underwriting model live at US checkout, which in its first deployment produced 3.4% more completed purchases than a control group, including approvals for people with no FICO score. Affirm also retooled more than 800 engineers around coding agents in February 2026, and is building pay-over-time into Google's AI Mode and Gemini and Stripe's agentic payment tokens.
Category
BNPL & lending
Founded
2012
Headquarters
San Francisco, United States
Licence and supervision
US: lending, servicing and brokering licences across states, with substantially all US loans originated by partner banks Celtic Bank (FDIC-insured Utah industrial bank) and Lead Bank (FDIC-insured Missouri bank), CFPB enforcement authority; applied January 2026 to the Nevada Financial Institutions Division and the FDIC for Affirm Bank, a Nevada-chartered industrial loan company (pending); UK subsidiary Affirm U.K. Limited authorised by the FCA for consumer credit; also operates in Canada and, in limited launch, Australia.
Scale
27.8 million active consumers and $50.2 billion of GMV in fiscal 2026 (year to June 30, 2026)
Flagship platform
Transformer-based underwriting model
AI leadership
Max Levchin · Libor Michalek · Vishal Kapoor · Daniel Martin
- Affirm's transformer-based underwriting model went live at US checkout on September 17, 2026; in initial deployment it approved applications the prior system would have declined, including thin-file and no-FICO applicants, yielding 3.4% more completed purchases against a control group, with Affirm saying those loans performed better than a comparable expansion under its previous models.
- Affirm's fiscal 2026 10-K says its machine-learning risk models are calibrated on data from over 553 million loans and are custom built to detect fraud, price risk and make recommendations; fiscal 2026 GMV was $50.2 billion (up 37%) from 27.8 million active consumers.
- In February 2026 Affirm paused normal delivery for an 'AI Retooling Week' in which over 800 engineers used agentic AI end to end, with Anthropic's Claude Code as the default tool; afterwards over 60% of its pull requests were agent-assisted, and Levchin wrote that an order-of-magnitude gain in software productivity is 'entirely plausible'.
- Levchin said on CNBC in September 2026 that Affirm has not had to cut staff to implement AI; the fiscal 2026 10-K reports 2,358 employees at June 30, 2026, and the FQ3'26 shareholder letter says Affirm expects to 'modestly grow' its development team.
- Agentic commerce: Affirm backed Google's Agent Payments Protocol (October 2025), agreed to support Stripe's Shared Payment Tokens for AI-agent checkouts (March 2026, 'soon') and began rolling its pay-over-time options into Google Search AI Mode and the Gemini app via Google Pay (May 2026).
- AdaptAI, Affirm's AI-powered promotions platform, was opened to merchants in April 2025 after delivering nearly 10% incremental conversion improvements on Affirm's own app and card; Levchin later cited an average 5% lift in merchant volume from early deployments.
- Affirm applied in January 2026 to charter Affirm Bank, a Nevada industrial loan company insured by the FDIC; the 10-K also discloses a generative-AI customer-service chatbot and names generative-AI bias, accuracy and regulatory risk as risk factors.
What is Transformer-based underwriting model?
Launched September 17, 2026 and live at US checkout: a transformer model that learns from the order and timing of events in a consumer's credit history, built on 14 years of transaction-level underwriting data. In initial deployment Affirm used it to approve applications its existing system would have declined, including people with limited credit histories and no FICO scores; against a control group that produced 3.4% more completed purchases, and Affirm says those loans performed better than a comparable expansion under its previous models. Affirm built a proprietary algorithm to keep the model's decisions as explainable as traditional machine-learning models while running in real time.[1]
What has Affirm done on AI, and when?
- Sep 18, 2026
Levchin: no staff cuts to fund AI[14]
On CNBC's Closing Bell Overtime, Levchin discussed the new AI underwriting system and said Affirm has not had to cut staff to implement AI.
- Sep 17, 2026
Transformer underwriting model goes live[1]
Affirm launched a transformer-based model that reads the order and timing of events in a credit history; in its first deployment it produced 3.4% more completed purchases than a control group, with a proprietary algorithm providing explainability at checkout speed.
- Aug 27, 2026
Fiscal 2026 10-K and a second President[10][11]
The 10-K reports $50.2 billion of GMV, 27.8 million active consumers and 2,358 employees, and discloses a generative-AI customer-service chatbot; the same day Michael Linford became a second President alongside Libor Michalek, who keeps engineering, risk and product.
- May 12, 2026
Investor Forum: transformer models outperforming[12]
At its 2026 Investor Forum, President Libor Michalek said Affirm had processed $150 billion of volume and tracked 2.3 billion repayments over 14 years, and that its newer transformer-based underwriting architecture was already outperforming previous model generations.
- May 12, 2026
Affirm payments roll into Google AI Mode and Gemini[7]
Affirm began rolling out its pay-over-time options in Google Search, including AI Mode, and the Gemini app when checking out with Google Pay.
- May 7, 2026
Shareholder letter: engineering 'truly AI-first'[9]
Levchin's FQ3'26 letter said the retooling week made agentically written code dominate non-agentic 'essentially overnight', that an order-of-magnitude productivity gain is plausible, and that Affirm still expects to modestly grow its development team.
- Apr 23, 2026
Affirm details its AI Retooling Week[8]
Affirm's engineering blog said that in February 2026 it paused normal delivery for a week and asked over 800 engineers to take real tasks through a fully agentic workflow, with Claude Code as the default tool; over 60% of pull requests are now agent-assisted.
- Mar 3, 2026
Stripe Shared Payment Tokens for AI-agent checkout[6]
Affirm said it will soon support Stripe's Shared Payment Tokens so AI agents can offer Affirm pay-over-time plans at checkout without exposing credentials.
- Jan 23, 2026
Affirm applies for a Nevada industrial bank charter[3]
Affirm submitted applications to the Nevada Financial Institutions Division and the FDIC to establish Affirm Bank, an FDIC-insured industrial loan company, with John Marion selected as its president.
- Jan 14, 2026
Underwriting adds real-time balance and cash-flow signals[2]
Affirm's underwriting began using account balances and cash-flow trends from linked bank accounts for Affirm Card and Affirm Money Account users; early results showed an average lift of about 12% when purchasing power rises.
- Oct 9, 2025
Affirm backs Google's Agent Payments Protocol[5]
Affirm announced support for Google's AP2, an open protocol for agent-led payments, extending a partnership that already covered Google Pay and Chrome autofill.
- Aug 29, 2025
Levchin cites a 5% merchant-volume lift from AdaptAI[13]
After fiscal Q4 2025 results (revenue $876 million, up 33%), Levchin highlighted AI, noting early AdaptAI deployments had delivered an average 5% lift in merchant volume.
- Apr 30, 2025
AdaptAI opened to merchants[4]
Affirm made AdaptAI, its AI-powered promotions platform, available to merchant partners for personalized, real-time promotions and credit offers at checkout, after it drove nearly 10% incremental improvements in conversion rates on the Affirm App and Affirm Card.
Where does Affirm use AI today?
| System | What it does | Status | Use case |
|---|---|---|---|
| Transformer-based real-time underwriting[1] | Every purchase is underwritten individually in real time; the transformer model, live at US checkout since September 2026, added 3.4% completed purchases in initial deployment. | In production | Credit scoring & underwriting |
| Explainable decisions for thin-file applicants[1] | The model approves some applicants with limited credit histories and no FICO scores; Affirm built a proprietary algorithm for explainability, with validation and ongoing monitoring of the explanations. | In production | Fair lending & discrimination |
| Real-time bank-account signals[2] | Underwriting uses account balances and cash-flow trends for Affirm Card users who link a bank account or hold an Affirm Money Account, with expansion to more consumers planned. | In production | Credit scoring & underwriting |
| ML fraud detection[10] | Affirm's 10-K says its machine-learning risk models, calibrated on data from over 553 million loans, are custom built to detect fraud and price risk. | In production | Fraud detection |
| Generative-AI customer-service chatbot[10] | The fiscal 2026 10-K says Affirm currently uses generative AI in its customer-service chatbot, with human involvement in training and monitoring. | In production | Customer-facing chatbots |
| Pay-over-time inside AI shopping agents[7][6][5] | Affirm options rolling out in Google Search AI Mode and the Gemini app via Google Pay; Stripe Shared Payment Token support announced for agent-initiated checkouts; support for Google's AP2 protocol. | Rolling out | Generative & agentic AI |
| Agentic software development[8][9] | After the February 2026 AI Retooling Week, over 60% of Affirm's pull requests are agent-assisted, with Claude Code as the default agentic coding tool and human checkpoints at planning, review and merge. | In production | AI-generated code & coding agents |
| AdaptAI personalized credit offers[4][10] | AI-powered platform matching promotions such as 0% APR or special repayment terms to a consumer's purchase and profile, in use on Affirm's own products and offered to merchants since April 2025. | In production | Credit scoring & underwriting |
Use-case links open the tracker's rules-by-use-case matrix: which documents govern each system type.
What has Affirm disclosed in numbers?
| Metric | Value | As of |
|---|---|---|
| Transformer model lift in completed purchases | 3.4% more completed purchases vs a control group (initial deployment)[1] | Sep 17, 2026 |
| GMV / active consumers | $50.2 billion GMV (up 37%); 27.8 million active consumers (up 21%)[10] | Jun 30, 2026 |
| Loans in risk-model data | over 553 million loans to date[10] | Jun 30, 2026 |
| Agent-assisted pull requests | over 60%; over 80% of engineers weekly active on an AI developer tool by December 2025[8] | Apr 23, 2026 |
| Employees | 2,358[10] | Jun 30, 2026 |
| AdaptAI conversion / merchant-volume lift | nearly 10% incremental conversion improvement on Affirm's own products; average 5% lift in merchant volume in early deployments[4][13] | Aug 29, 2025 |
| Real-time signals purchasing-power lift | about 12% average lift when purchasing power rises (early results)[2] | Jan 14, 2026 |
“What’s exciting about the transformer model architecture is that we can now find new information within the data we already have. Seeing a credit history more clearly means we can responsibly say yes to more people.”[1]
Libor Michalek · President · Sep 17, 2026
“We think an order of magnitude gain in software development productivity is entirely plausible, yet we expect to modestly grow our development team – the limiting factor for Affirm has always been engineering cycles, not ideas for what to do with them.”[9]
Max Levchin · Founder and CEO · May 7, 2026
“We don’t benefit from extending credit that can’t be repaid, which means saying yes to more people only works when we get even better at saying no.”[1]
Libor Michalek · President · Sep 17, 2026
“Affirm was built AI native from the beginning, and this is what we’re excited to bring into agentic commerce with the support of partners like Stripe.”[6]
Vishal Kapoor · SVP of Product · Mar 3, 2026
Who runs AI at Affirm?
Daniel Martin
Sr. Director of Engineering, Developer Productivity (led AI Retooling Week)[8]
Which regulators govern Affirm's AI?
| Authority | Why it matters here | Documents |
|---|---|---|
| CFPB | Affirm's 10-K says it is subject to CFPB regulatory and enforcement authority as a facilitator, servicer, acquirer or originator of consumer credit; its transformer underwriting model and generative-AI chatbot fall under ECOA/Regulation B adverse-action and chatbot expectations. | ECOA / Regulation B adverse action (15 U.S.C. 1691(d); 12 CFR 1002.9) CFPB Circular 2022-03 CFPB Chatbots in Consumer Finance (issue spotlight, 2023) |
| FDIC | Substantially all US loans are originated by FDIC-insured partner banks Celtic Bank and Lead Bank, and Affirm applied in January 2026 for FDIC insurance for its proposed Affirm Bank industrial loan company. | |
| Nevada Financial Institutions Division | Reviewing Affirm's January 2026 application to charter Affirm Bank as a Nevada industrial loan company. | |
| UK (BoE / PRA / FCA) | Affirm U.K. Limited is authorised and regulated by the FCA for consumer credit activity, bringing its UK underwriting under FCA oversight. | FCA AI Update (Apr 2024) |
Linked authorities have a page in the AI Regulation Tracker; the others are named for completeness and not yet tracked.
What does the public record suggest about Affirm's AI strategy?
Analysis by BankingNewsAI from the sources cited on this page. Observations, not advice.
01
The flagship AI claim is measured against a control group
Affirm reports the transformer model's effect as 3.4% more completed purchases against a control group and says the added loans performed better than a comparable expansion under its prior models. It has not published loss rates for those loans, so the performance claim rests on Affirm's own comparison.
02
Approving no-FICO applicants raises the explainability bar
The model's gains come partly from approving people with thin files or no FICO score. Affirm built a proprietary algorithm for explanations, which is the piece adverse-action rules under ECOA/Regulation B depend on when an application is declined.
03
Coding agents, without headcount cuts so far
Over 60% of pull requests became agent-assisted after the February 2026 retooling week, yet Levchin says Affirm has not cut staff to implement AI and expects to modestly grow its development team; 2,358 employees were on staff at June 30, 2026.
04
Agentic commerce is a distribution bet built on per-purchase underwriting
Google AP2, Google AI Mode and Gemini, and Stripe's Shared Payment Tokens all put Affirm's real-time underwriting behind an AI agent's checkout, where Affirm argues fixed per-purchase terms are easier for agents to present than revolving credit.
05
A bank charter would pull the models closer to bank supervision
Today partner banks originate substantially all US loans; if the Nevada industrial loan company is approved, Affirm's own FDIC-insured bank would originate loans underwritten by its models.
How does Affirm use AI?
Affirm uses in-house machine learning to underwrite every purchase in real time, and in September 2026 put a transformer-based model live at US checkout that produced 3.4% more completed purchases than a control group. It also uses ML to detect fraud, a generative-AI customer-service chatbot, the AdaptAI promotions platform and coding agents that assist over 60% of its pull requests.
What is Affirm's transformer underwriting model?
Launched September 17, 2026, it is a transformer-based model that learns from the order and timing of events in a consumer's credit history, built on 14 years of Affirm's transaction-level data. In initial deployment it approved applicants the prior system declined, including some with no FICO score, producing 3.4% more completed purchases; a proprietary algorithm keeps decisions explainable.
Did Affirm cut jobs because of AI?
No cuts have been announced. Levchin told CNBC in September 2026 that Affirm has not had to cut staff to implement AI, and his May 2026 shareholder letter said Affirm expects to modestly grow its development team even though over 60% of pull requests are now agent-assisted. Affirm had 2,358 employees at June 30, 2026.
Does Affirm use Claude or other AI coding tools?
Yes. Affirm's engineering blog says it chose Anthropic's Claude Code as its default agentic coding tool for an AI Retooling Week in February 2026, when over 800 engineers took real tasks through an agentic workflow; over 60% of its pull requests are now agent-assisted.
Can you use Affirm with AI shopping agents?
Increasingly. From May 2026 Affirm began rolling out its pay-over-time options in Google Search AI Mode and the Gemini app through Google Pay, it supports Google's Agent Payments Protocol, and it announced in March 2026 that it will soon support Stripe's Shared Payment Tokens for AI-agent checkouts.
Is Affirm a bank?
Not yet. Substantially all of Affirm's US loans are originated by partner banks Celtic Bank and Lead Bank. In January 2026 Affirm applied to the Nevada Financial Institutions Division and the FDIC to establish Affirm Bank, an industrial loan company; the application was still pending in its August 2026 10-K.
Who regulates Affirm?
In the US Affirm is subject to CFPB authority and state lending licences, and its partner banks are FDIC-insured; its proposed Affirm Bank needs Nevada and FDIC approval. In the UK, Affirm U.K. Limited is authorised by the FCA for consumer credit. Affirm served 27.8 million active consumers at June 30, 2026.
- Affirm launches transformer-based machine learning model for real-time underwriting
- Affirm updates underwriting with enhanced signals to better reflect consumers' real-time finances
- Affirm submits applications to establish industrial loan company
- Affirm launches "AdaptAI" - its AI-powered promotions platform - to merchant partners
- Affirm extends collaboration with Google as a supporter of Agent Payments Protocol (AP2)
- Affirm expands Stripe partnership to support Shared Payment Tokens for agentic commerce
- Affirm works with Google to make AI shopping payments clear and simple
- How Affirm Retooled its Engineering Organization for Agentic Software Development in One Week
- Affirm FQ3'26 Shareholder Letter (Exhibit 99.1 to Form 8-K)
- Affirm Holdings Annual Report (Form 10-K) for the fiscal year ended June 30, 2026
- Affirm Holdings Form 8-K (appointment of Michael Linford as President)
- Affirm Targets Card Networks With Broader Payments Push
- Affirm stock rises 10% as CEO Levchin notes continued consumer strength
- Never had to cut staff to buy more AI tokens, says Affirm CEO as it rolls out AI underwriting
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