Apple Pay Later is coming soon to iOS 16. What you need to know about buy now, pay later option

Apple will soon enter the rising "buy now, pay later" business.

The tech giant rolled out iOS 16 on Sept. 12, delivering several new features to freshen up iPhones.

Among the handful of features not available at launch is Apple Pay Later, a new service that allows iPhone owners to make purchases using buy now, pay later options.

Interest in using buy now, pay later services continues to rise. A survey conducted last summer by consulting firm McKinsey and Co. found that 60% of U.S. consumers said they planned to use buy now, pay later products in the coming year.

Here's what you need to know about Apple's foray into the buy now, pay later space:

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What is Apple Pay Later?

It's Apple's buy now, pay later service where shoppers who use Apple Pay on a purchase can break that cost up into smaller payments. It's eligible to any Apple Pay users who check out with the service online or in an app.

How does Apple Pay Later work?

When shoppers check out with Apple Pay, they get the option to pay in full or pay later. When choosing to pay later, shoppers can break down their purchase into four separate payments over six weeks, with no interest or fees. The service is run using Mastercard's network.

Using the Wallet app, users can track the purchases where they used Apple Pay Later and when their next payment is due.

When is Apply Pay Later available?

Apple said Pay Later will be available in a future update for qualifying applicants in the U.S., according to Apple's iOS 16 page.

What other features are coming soon to iOS 16?

Apple Pay Later isn't the only feature unavailable during last week's launch of iOS 16. Later this year, Apple will roll out the iCloud Shared Photo Library. The feature allows iPhone owners to create a photo library and allow multiple people to view and contribute photos or videos.

Also launching later this year: Live Activities, which brings real-time updates of events directly to the lock screen.

Contributing: Katie Wedell

Follow Brett Molina on Twitter: @brettmolina23.