--- title: "Markets put a December Fed hike at 99% odds; Affirm's $259 million reserves and Chime's credit face the bill" description: "The hike lands on consumer lenders that just leaned into credit. Affirm reserved near $259 million against souring loans, Chime's losses are rising on first-time borrowers, and Cash App's primary banking base has stopped growing." publisher: "The Inference" section: "Economy" published: 2026-11-14T18:17:18.854Z modified: 2026-11-14T18:17:18.854Z canonical: https://theinference.org/article/markets-put-a-december-fed-hike-at-99-odds-affirm-s-259-million-reserves-and-chime-s-credit-face-the-bill language: en keywords: "Affirm, Chime, Block, Consumer Credit, Federal Reserve, Buy Now Pay Later" --- # Markets put a December Fed hike at 99% odds; Affirm's $259 million reserves and Chime's credit face the bill > The hike lands on consumer lenders that just leaned into credit. Affirm reserved near $259 million against souring loans, Chime's losses are rising on first-time borrowers, and Cash App's primary banking base has stopped growing. ## The hike is priced, and the filings name who pays Consumer prices rose 0.4% in October, above forecasts for a third straight month, and Federal Reserve Governor Christopher Waller put a half-point hike on the table if inflation momentum persists, a line Dallas Fed President Lorie Logan and Chicago Fed President Austan Goolsbee echoed [1]. Markets put a hike at the Fed's December meeting at 99% odds, and [Goldman Sachs](https://theinference.org/markets/companies/goldman-sachs) Asset Management's Lindsay Rosner calls it the firm's base case; [The Inference priced that trade on November 10](https://theinference.org/article/october-cpi-locks-in-a-december-hike-that-lands-three-weeks-after-anthropic-s-90-billion-ipo-prices) [2]. The filings since name who pays first: [Affirm grew provisions and delinquencies into the print](https://theinference.org/article/affirm-beat-but-fell-on-provisions-near-259-million-its-push-into-banks-apps-starts-in-2027) [3], [Chime](https://theinference.org/markets/companies/chime) is buying a bank to fund its rising first-time-borrower credit [4][5], and Cash App is building lending on a banking base that has not grown since June [5][6]. [Affirm](https://theinference.org/markets/companies/affirm) and [SoFi](https://theinference.org/markets/companies/sofi) shares ended a second straight week lower [1]. ## Affirm grew faster and reserved more Affirm, the buy-now-pay-later lender, financed $14.4 billion of purchases in its September quarter, up 34%, a twelfth straight quarter above 30% growth; revenue rose 35% to $1.262 billion, and net income of $164 million marked an eighth consecutive quarter of GAAP profit [3]. *Chart: **Affirm's quarterly revenue has more than doubled in three years, to $1.26 billion** Column chart of Affirm's quarterly revenue from the December 2023 quarter through the September 2026 quarter, rising from $0.591 billion to $1.262 billion with a pause in early 2026* *Affirm revenue by calendar quarter, $ billions, as reported in its SEC filings. The final column is the quarter ended September 30, 2026, the one in this story: $1.262 billion, up 35%. Source: Affirm, quarterly figures from its SEC filings. [8]* The bill sat in credit. Provisions ran near $259 million [3], the allowance for credit losses, Affirm's reserve against souring loans, rose to 6.3% from 5.9%, and 30-day delinquencies climbed 35 basis points in the quarter to 2.9% [7]. Funding is the December exposure: [the average cost of funds rose 27 basis points on higher benchmark rates](https://www.marketscreener.com/news/affirm-q1-2027-shareholder-letter-ce785fddda8ef222), the outlook assumes short-term rates rise through fiscal 2027, and more than 70% of its funding is fixed-cost [7]. *Chart: **Affirm's reserve and its late-loan rate both jumped in the September quarter** Line chart of Affirm's allowance for credit losses and 30+ day delinquency rate at three quarter-ends, both jumping in September 2026; the two earlier delinquency points are marked as estimates* *Allowance for credit losses as a share of loans held for investment, and 30+ day delinquency rate excluding Peloton and Pay in X loans, percent. The Sep 2025 and Jun 2026 delinquency points, 2.81 est. and 2.55 est., are implied by the reported 9bp year-over-year and 35bp quarterly rises; the 2.9% reading and all allowance figures are as reported. Source: Affirm FQ1'27 shareholder letter. [7]* ## Chime is buying a bank to fund its credit cheaper Chime, the banking app, ran credit at 29% of purchase volume in the third quarter, nearly twice its share a year earlier [4][5]. Interim finance chief Mark Troughton said [its Instant Loans loss rate rose as first-time borrowers joined through the Prime tier](https://finance.yahoo.com/markets/stocks/articles/chime-financial-chym-said-q3-021416272.html) and could rise again this quarter, while repeat borrowers lose up to 50% less [4][5]. Chime's hedge is a bank charter: [the Stride Bank purchase](https://theinference.org/article/chime-pays-590-million-to-own-its-sponsor-bank-block-s-charter-bid-rests-on-an-occ-rule-now-in-court), set to close in the first half of 2027, carries more than $100 million of annual after-tax synergies and, management says, lower funding costs [4]. ## Cash App's banking base stopped growing as Block builds its lending Cash App, [Block](https://theinference.org/markets/companies/block)'s payments app, counted 9.4 million primary banking actives in September, unchanged from June [5], even as [Cash App gross profit rose 27% to $2.07 billion](https://pulse2.com/block-reports-3-24-billion-in-third-quarter-2026-gross-profit-up-22-as-cash-app-reaches-60-million-active-users/) and Block builds out lending infrastructure through its Cash App Score underwriting [6]. The app reached 60 million monthly transacting actives in September [6]; the paycheck base inside it did not grow. ## The February reserve print is the first test The bull case is filed too: [Affirm's transformer-based underwriting model](https://theinference.org/article/affirm-s-ai-approves-shoppers-fico-can-t-see-before-anyone-explains-the-rules), kin to the engines behind large language models, lifted conversion 3.4% with credit losses flat [7], Chime's MyPay paycheck advances run at a 1.1% loss rate [4], and every published Affirm target sat above its post-print close [3]. The squeeze is timing: Affirm now lends to a wider pool of borrowers and Chime books first-time ones, just as the Fed prepares to raise the benchmark rates their funding costs track [2][7]. Affirm's February print shows whether the 6.3% allowance holds as the test loans roll off, and Chime gives 2027 guidance on its fourth-quarter call [3][4]. A one-day rate decision reprices loans that borrowers repay over years. ## Takeaway Markets price a December hike at 99% odds. Affirm reserved near $259 million and its 30-day delinquencies rose to 2.9%, Chime is buying a bank to fund first-time borrowers, and Cash App's 9.4 million primary banking actives have not grown since June. ## Sources 1. [Yahoo Finance / StockTwits, US Fintech Weekly: Coinbase Secures Federal Trust Charter, While Hot CPI Pressures Rate-Sensitive Lenders, 13 November 2026](https://finance.yahoo.com/markets/stocks/articles/us-fintech-weekly-coinbase-secures-013335853.html) 2. [The Inference, October CPI locks in a December hike that lands three weeks after Anthropic's $90 billion IPO prices, 10 November 2026](https://theinference.org/article/october-cpi-locks-in-a-december-hike-that-lands-three-weeks-after-anthropic-s-90-billion-ipo-prices) 3. [The Inference, Affirm beat but fell on provisions near $259 million; its push into banks' apps starts in 2027, 7 November 2026](https://theinference.org/article/affirm-beat-but-fell-on-provisions-near-259-million-its-push-into-banks-apps-starts-in-2027) 4. [MarketBeat via Yahoo Finance, What Chime Financial (CHYM) Said on Its Q3 Earnings Call, 4 November 2026](https://finance.yahoo.com/markets/stocks/articles/chime-financial-chym-said-q3-021416272.html) 5. [PYMNTS, Chime and Affirm Show the Trade-Offs Behind Credit Growth, 11 November 2026](https://www.pymnts.com/alternative-credit/2026/chime-affirm-show-trade-offs-behind-credit-growth/) 6. [Pulse 2.0, Block Reports $3.24 Billion In Third Quarter 2026 Gross Profit, Up 22%, As Cash App Reaches 60 Million Active Users, 6 November 2026](https://pulse2.com/block-reports-3-24-billion-in-third-quarter-2026-gross-profit-up-22-as-cash-app-reaches-60-million-active-users/) 7. [Affirm Holdings, FQ1'27 Shareholder Letter (via MarketScreener), 5 November 2026](https://www.marketscreener.com/news/affirm-q1-2027-shareholder-letter-ce785fddda8ef222) 8. [Affirm, quarterly figures from its SEC filings, retrieved 14 November 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001820953) --- Markets put a December Fed hike at 99% odds; Affirm's $259 million reserves and Chime's credit face the bill — The Inference. Canonical: https://theinference.org/article/markets-put-a-december-fed-hike-at-99-odds-affirm-s-259-million-reserves-and-chime-s-credit-face-the-bill