Airfordable Lets You Pay for Flights on Layaway

When most people think about layaway plans, they usually think of toys and clothing for the holiday season. In comes Airfordable, a Chicago based tech startup that allows users to pay for airline tickets in installments. It’s easy. Travelers must submit a screenshot of an itinerary along with the trip details; and then Airfordable presents a payment plan.

After making an initial deposit, regular payments can be made on the overall balance through the date of departure.

It’s an option for those low on cash or credit, as well as those wanting to lock in a fare, said cofounder and CEO Ama Marfo.

The Ghana native was inspired with the idea while attending Drexel University in Philadelphia.

“I wanted to see my family in Ghana during school breaks, but couldn’t afford the $2,000 ticket,” she said. “I stayed in the dorm alone or with other international students who couldn’t go home. Because of this personal frustration, I set out to determine how to make travel more accessible.”

Gaining Traction

Marfo met cofounder and COO Craig Henry when he contacted her while researching a similar idea, and they decided to join forces. Third cofounder Emmanuel Buah, the company’s chief technical officer, was referred by friends and came on-board because of his technology and startup experience, Marfo said.

There are over 27,000 people are in the Airfordable community booking international and domestic flights for a broad number of uses.

“We have a lot of students using Airfordable to travel home or for study abroad programs. Other users are planning travel based around life milestones such as destination weddings and family vacations. We are covering just about any travel need you can think of,” Marfo added.

“A lot of people, especially those who live paycheck to paycheck, don’t have the money to pay for plane tickets upfront,” says Ama Marfo, co-founder of Airfordable. “But that shouldn’t stop them from traveling or resorting to credit cards to pay for plane tickets.”

How It Works

Once you are approved, the startup calculates a payment plan (up to 3 months) that starts with an upfront deposit and ends sometime before your flight takes off. And after your final payment Airfordable will email you a confirmed e-ticket for the trip.

One problem – for this convenience the startup charges a pretty lofty fee – anywhere from 10-20%, depending on demand, the date of travel, and ticket price. Assuming a 3-month repayment period, a 20 percent fee is essentially an insane 80% APR.

But thinking of the fee as an interest rate isn’t exactly the right way to do it – mainly because a service like Airfordable could mean the difference between someone being able to take a trip or not – turning it into a priceless service. Ama Marfo, co-founder of Airfordable, echoes this sentiment when she explained that “the fee is high for people that don’t understand the value”.

Plus, in return, the company doesn’t check your credit score, meaning customers with poor or no credit could potentially be approved for a layaway plan.

So far the service has been used by about 10,000 people with a 95 percent repayment rate. This rate may be so high because the entire balance needs to be paid before you take the trip, unlike a credit card or loan service like Affirm. The upside to this is that a traveler doesn’t have to be stuck paying for their trip months after they return from it.

If a traveler doesn’t pay before their trip, their flight is canceled. But, all payments that they made after the initial deposit are credited towards a future trip.

In the future, the company hopes to expand into layaway payments for vacation packages and hotels. Soon they will have a custom travel search platform so users don’t have to upload their own travel screenshots.

They also are working towards finding a financial institution to back their layaway plans – as of now all flights are being purchased from the company’s operating funds.