Afterpay gives its customers the option of four interest-free instalments to pay off virtually any consumer item. This includes items purchased in-store or online.
The Covid-19 pandemic allowed the company to soar. There has been an increase in those choosing online shopping or as a way for consumers to manage their cash flow. Many consumers, especially the younger generation, are loyal to this service. This is because Afterpay is simple, safer, and provides an alternative to a traditional credit card. Afterpay makes it easy to sign up anytime. This includes in-store signups while you are in the middle of a transaction should you wish to break up your payments.
E-commerce has done extremely well during the Covid-19 pandemic with an upsurge in those choosing online shopping while in lockdown. Many retailers have started offering Afterpay as a payment method in checkout as it allows them to reach a larger market and drive average order value up to 40%.
The market for more pay-later solutions appears to be growing with many similar options rising like Zip pay, Klarna and Humm. Banks are also releasing their own similar offerings. The market for buy-now-pay-later has grown significantly in Australia and overseas. However, it still only makes up for 1% of payment types.
AfterPay now boasts more than 16 million users and 100,000 merchants.
Afterpay was recently purchased by Square for $39 billion. Square is a tech company that allows millions of businesses to use their Eftpos machines. It also offers the ability for any Apple or Android devices to buy, sell and receive payments.
Together these two services will be able to be a bigger player in online payments and will be direct competition for traditional credit markets.
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