Big banks beware. There’s a new kid in town aiming to take your credit card customers. Start-up Affirm, led by PayPal co-founder Max Levchin, has launched Split Pay, an option on a growing number of sites that lets customers pay for online purchases in three monthly installments.

Who’s the prime candidate for such a deal?

Affirm is betting on young people. Their pitch? Lower rates, no late or hidden fees, and a general good-guy attitude. It’s a smart strategy considering that young people often have trouble getting credit due to their limited histories. It’s doubly smart considering that many have grown up with an allergic reaction to large financial institutions.

But what about credit risk?

Notably, Affirm will instantly determine creditworthiness based on some 80,000 data points, like what phone OS a user has and social media preferences. Sounds impressive, but we wonder if they’ll have to open things up and expose themselves to more potential “bads” to get scale. Or if they’ll have to put a low ceiling on the credit extended to some borrowers, which may tick off customers. We’ll be watching to see how this one plays out.