LONDON–“Buy Now Pay Later” financing, also known as BNPL, continues to expand rapidly around the globe.
According to a new analysis by GlobalData, BNPL has now emerged as a viable credit option for e-commerce purchases in Asia-Pacific (APAC) as several payment companies are now offering this service. CUToday.info also has coverage of the growth of BNPL in the U.S. here and here. An analysis of GlobalData’s E-Commerce Analytics reveals the APAC e-commerce market is set to grow at a compound annual growth rate of 17.6% from $1.2 trillion in 2016 to $3.6 trillion in 2023.
“The COVID-19 pandemic has not only adversely affected businesses but also consumers’ disposable income,” said Ravi Sharma, lead banking and payments analyst at GlobalData. “As a result, with rise in demand for consumer financing and growing e-commerce sales buy now and pay later service has emerged as a major short-term borrowing tool for consumers.
“BNPL provides consumers with the flexibility to pay for their purchases at later dates. In addition, unlike traditional credit cards or consumer loans, there is no fee if payments are made on time,” he continued.
Thriving Solutions
According to GlobalData, several BNPL solutions in the region have thrived during the pandemic. For instance, Australia-based BNPL solution provider Afterpay has reported global sales of $10.1 billion in the first half of 2020, a year-over-year growth of 112%. It also added nearly 23,000 new customers daily to its platform in the same period.
“BNPL is very popular in Australia with 5.8 million accounts,” stated GlobalData. “The entry of global players like Klarna further fostered growth in the country. Other Asian markets like China and India have also registered similar trend.”