Affirm Poised to Gain as 2026 Tax Refunds Slash Competitor Loan Demand
Upstart expects 2026 average tax refunds to rise about 26.7% to $3,800, likely reducing low-credit consumer demand for personal loans on its AI platform. Proposed federal lending standards tightening could constrain nontraditional underwriting, creating a competitive opening for Affirm’s more traditional installment and buy-now-pay-later services.
1. Competitor Tax Refund Impact
Upstart’s AI-based lending platform may see demand drop as average federal tax refunds rise roughly 26.7% to $3,800 in 2026, reducing consumer need for personal loans among low-credit customers and potentially redirecting borrowing activity toward Affirm’s installment and buy-now-pay-later products.
2. Potential Regulatory Advantage
Proposed federal crackdowns on nontraditional underwriting and tighter lending standards could pressure AI-centric lenders like Upstart, positioning Affirm to attract borrowers and financial partners seeking a more established compliance framework.