Hey @LB16
Both are great questions, and I would be happy to get you some more information on these topics.
Shop Pay showing as a Buy Now featured option is a dynamic express checkout option that will show various express payments based on the users device and browser cache. If they are on an apple product and using Safari then they might see Apple Pay, on a Google phone they might see Google Pay, and if they have used Shop Pay in the past then they might see Shop Pay. If the dynamic button can’t recognize any specific express checkout options that the customer is eligible for, then it just shows “Buy Now”. The link that @Dan-From-Ryviu shared goes into this in more detail.
This button is optional and you can disable it from within your theme settings. If you do not wish to offer Shop Pay then you can also disable that specifically in your Shopify Payments settings as well.
For the second question, how does Shop Pay installments work, is very straightforward. The customer makes their purchase and signs an agreement with Affirm (who powers our installment options). You receive payment in full and would fulfill the order as normal. If there is any issues with the installment payments that is between the customer and Affirm, the merchant is not involved in that. You can review additional information about this in our Help Center here: Shopify Help Center | Shop Pay Installments FAQ.
I am happy to answer any other questions you might have about Shop Pay or paying in installments. Don’t hesitate to reply back!