$1 Club, page-16017

It's not a simple question to answer. For instance we technically saw the whole market affected by the shift in bond yields.

If inflation rises too quickly, then the Fed will step in and increase interest rates. This is the risk for companies that want to borrow money. Higher interest rates mean high cost to borrow money. Even if interest rates were increased by 1% that still leaves interest rates under 2% which is incredibly low historically.

It' interesting to understand that increased interest rates could potentially affect the fees of some credit cards. BNPL has 0% interest so this would make it a better option for the consumer over a credit card.

Now BNPL companies (growth companies in general) borrow money to fund operations so that they can grow the top line revenue figure with the idea that eventually revenue will outpace expenses. At the moment most companies are raising through issuing equity. This does not add debt. The availability of funds from sophisticated investors may begin to become harder to come by as fixed interest income becomes more appealing (remember we're talking still below 2% so how appealing are we really talking?).

In my opinion BNPL has become a big part of millennial culture. It's a widely accepted form of payment and it actually fits in better with payment methods that Asia culture are more accustomed to such as paying with an e-wallet. Overall I don't see any macro factors that would create a bad outcome for this sector.