Afterpay. Caught between a rock and a hard place, page-2

visa & MasterCard will almost certainly not compete. They are not credit providers, but a fee for payment rails service. They will not move towards taking on credit risk. I’ve been saying for years that PayPal was a natural owner of afterpay (PayPal for instant purchase, afterpay for split purchases) but hasn’t happened yet.

competition will eventually cannibalise & lead to industry rationalisation, by the likes of PayPal & the banks perhaps, but more likely between bnpl players as the land grab becomes expensive & margins squeeze, though if lead performance is a matters to retailers, afterpay has significant margin protection. Many of afterpays customers now only shop at afterpay retailers. Retail industry would be aware of this.

banks are not in it for the revenue or the profit in bnpl (look at total aus bnpl revenue versus bank revenue), they are in it because their customer base is potentially at risk down the track.