The Afterpay Ltd (ASX: APT) share price is under pressure this morning, down 9.16% to $107.51 at the time of writing.
Afterpay shares might be following the lead of its US-listed rival, Affirm Inc (NASDAQ: AFRM), which tumbled 10.45% overnight.
What's causing the Afterpay share price selloff?
According to Bloomberg, Apple has teamed up with Goldman Sachs to bring a new BNPL service to the market, internally known as "Apple pay Later".
Bloomberg reported that Apple is eyeing the BNPL market as an opportunity to drive Apple Pay adoption and encourage more users to pay with their iPhones instead of traditional credit cards.
The new service is still in development but the report suggests it will incorporate classic BNPL features, including an option to pay across four interest-free instalments every fortnight or across several months with interest.
Afterpay has experienced explosive growth in North America, with its third quarter results highlighting a 112% year-on-year increase in active customers to 9.3 million.
But, by comparison, Apple Pay is a top mobile payments player in the United States, with 43.9 million users in 2021, according to Tech Crunch.
Competition continues to mount in the BNPL space
While Apple's new service is still in development, this might add to the narrative of increasing competition within the BNPL space.
In March this year, the Commonwealth Bank of Australia (ASX: CBA) announced plans to roll out its own BNPL offering to eligible customers from mid-2021.
In the same month, PayPal (NASDAQ: PYPL) also announced plans to bring a BNPL service to the Australian market.
The payments giant said that its "Pay in 4" product will roll out to over 9 million Australian accounts by early June 2021.
Afterpay share price tumbles to negative year-to-date returns
The Afterpay share price was enjoying a bullish resurgence last month, rallying to a 4-month high of $132.40 on 24 June.
Unfortunately, today's sharp selloff drags the Afterpay share price back into negative year-to-date territory.
Afterpay shares are now down 8% year-to-date.
