"But if customers directly link their bank accounts, transactions can be taken off the card networks.“Using the Afterpay Money app for future repayments, we forecast Afterpay could reduce its Australian payment processing costs from 0.85 per cent currently to 0.05 per cent for Afterpay Money customers by using real-time payments and the new payments platform, though this could take several years to play out,” Mr Stadnik said."
APT want to make referal fees on financial products, but also by getting people into accounts they can direct debit. This will apparently save them the card scheme fees they currently pay, upwards of 1% gross. Interesting that the biggest benefit to APT of doing this WBC tie up, trying to cut out Visa/MC, is not mentioned in the announcement!
I think the 'features' are pretty weak, obviously they can add more things, however maybe they will offer cash bonuses for people to hook up an APT account for direct debit? A 'mega app' is the goal, but that remains to be seem.
Pretty big switching costs with banking, such as changing direct debits, setting up salaries and its likely an APT user would still retain their Big4 relationship. I'm not entirely convinced someone woukd completely migrate to the APT for their entire finances. (Also not convinced yet the core APT product is sustainable)
That is part of the reason the Big4 have wide moats. It will be interesting to see how much APT is willing to pay per customer. Chucking $50 vouchers at people for sign ups might overcome the switching cost.
