Chart - Z1P, page-6881

Competition will definitely bring down the margins but it will effect a single source revenue earner like Afterpay, but then again expansion will easily compensate the loss. Interest cost for the already big BNPL is no more a significant element unlike the newcomers, if interest rate rises the newcomers will perish. For the already big BNPLs operating costs will start declining which will definitely compensate for any rise in interest rate. BNPLs have already established the best form of financing and there is no more opportunity cost with interest element.

BNPLs have already survived the more dangerous initial phase and now when the cost reduction phase emerges they will prove their sustainability. Remember BNPL is not increasing consumption significantly it is rather bringing forward the timing of consumption.