Square, the digital-payments company led by Twitter founder Jack Dorsey, has agreed to buy Australian buy-now, pay-later company Afterpay for $29 billion. People, this is what it is: we are now in the new age of Buy Now, Pay Later, reshaping the whole credit economy. In other words, many young people are not interested in the old credit system, and have shown through the evolution of the Buy Now, Pay Later systems that they prefer this evolving model. I expect more exits in this space as Apple Pay joins the fray and most want to get out before the ecosystem is reshaped.
In the age of fintech boom, every payment company appears to have a goal to expand to new markets. For some, it means raising funds in new rounds; while for others, it means acquisition or using a different playbook. From Stripe’s acquisition of Nigerian startup Paystack to Flutterwave, another Nigerian payment firm, attaining unicorn status, the uptick has been remarkable. Now Square, a payments company cofounded by Twitter CEO Jack Dorsey, is joining the race.
Square plans to buy Australian fintech company Afterpay as it looks to expand further into the booming installment loan market.
In some cases, you may not even have to pay interest (the merchant pays the interest for you)!
In Nigeria, expect agile fintechs to begin to redesign their lending products with BNPL since BNPL is more optimized as the interest rate is activated after you have identified and acquired the products, instead of borrowing money and warehousing in a bank account, and yet paying interest when you have not deployed it.
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This shift is massive as repayment uses bank account ACH (minimal fees), not credit cards. So, if this BNPL picks up at scale, card companies like Visa and Mastercard could be in the crosshairs of a major shift.
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As the world encounter a massive population and demographic restructuring one of the things that is needed is a an in-depth understanding of what each demography needs and how to serve them skillfully.
It a bait, buy now and pay at convenience- In a larger form they now control how you spend.
Also, I deeper way of understanding the Human behavioral Nature in response of Long terms spending, you can call it Financial behavioral conditioning.
The old order in the financial services will be completely dismantled and redesigned, whether it requires hostile or non hostile takeover will remain to be seen, but the revolution is on.
This world will be a different place a decade from now, even some things that ordinarily wouldn’t make sense to business tycoons will soon become dominant business models.
As always, investors buy the future, not present, so anything with future prospects is in the game.
Don’t waste too much energy fighting to keep the old order relevant, you will be embarrassed and forgotten if you do.
The digital economy is here and there is no going back.