What will happen to the BNPL if Visa/MasterCard join the club, page-30

It has been stressed many times throughout the forum that V/MC they are payment technology, a gateway. Banks use this technology to provide payment service, banks are the one who will take credit risk. However, banks don’t have flexibility of BNPL service providers. Because when banks take credit they have to follow Basel accords. Bank just can’t take on credit whichever way they like. On the other hand it is much easier to give money to BNPL then let them take the risk and just sit on interest payment. They can do it if they want but the product will be shitty, just have a read through on the T&C of surepay by CBA. it will take a bit of time for banks to a develop a final credit risk model for BNPL product which aligns with Basel accord.

you should be asking why banks didn’t make there own gateway instead still use V/MC? Firstly why reinvent the wheel? Secondly it is probably a patented technology.