Industry Insights

Five buy now, pay later companies racking up interest

  • Private Equity
  • Financials
  • Global

With a pandemic-driven explosion of e-commerce, the buy now, pay later (BNPL) segment is now worth an estimated USD 3.7bn. As the name suggests, consumers are able to buy products without an upfront payment, with repayment plans offering variable interest rates and lengths. The levels of regulation around the world differ widely: in the US, it depends on a state’s definition of credit, among other aspects, while the UK’s Treasury is mulling over placing BNPL under FCA oversight. As this industry continues to grow, it’s clear that new regulations and entrants could shake things up for incumbents. Here are five BNPL companies that Third Bridge Forum’s Interviews have explored.

PayPal’s BNPL service was launched in late 2020. What separates PayPal from its competitors are its other offerings, including retail instalment plans, a point-of-sale solution and digital wallet, according to a senior executive from Intrepid Ventures. Although this specialist doesn’t believe they could usurp Mastercard or Visa, “if you were speculating about who might, in 10-plus years, be a third or fourth genuinely global system, PayPal might be a very dark horse in that.” Despite its strength across the board, BNPL doesn’t seem to be a focus for the company. Asked whether PayPal would continue to lag other players, a former head from Affirm commented that “there were [no] direct plans to set it up in a way that would be competitive with Afterpay or Klarna. Certainly, that could change if they decide to make an investment.”

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