I've been a holder of Afterpay for many years until recently....

I've been a holder of Afterpay for many years until recently. Many of you would know I can be direct and I'm unapologetically critical of many posts on hotcopper, and somewhat infamous for it. You might hate me for it but I pride myself in using logical thinking and like to back up my analysis as best i can.

Now i wont talk too much about why the current macroeconomic environment isn't great for Afterpay as this has been discussed at length.

Instead I'd like to point out some of the cracks that are starting to appear in Afterpay's armor that are related to the macroeconomic environment, especially unemployment.

I've noticed a very sudden and frequent appearance of hardship comments on social media, especially on the AfterpayUSA account including:


While this isn't unexpected, what somewhat surprised me was the merchants offering the service are also reaching out:


Then there is the lowering of transactions of existing and loyal following who understand that they need to go without discretionary spending during this time of uncertainty:



Another interesting find is an increase in searches on US google trend related to Afterpay and coronavirus and Afterpay customer service (the same applies to competitors). This suggests to me that customers are enquiring on Afterpays response to CovID-19 in relation to hardship.






Lastly the following reviews are for Klarna, the most direct competitor and I'm anticipating these kind of reviews to pop up for afterpay and Clearpay very soon.

Its early evidence of customers struggling and deferring payments, consumers making concious decisions to pull back their use of Afterpay and also signs of merchants really struggling and even wanting Afterpay to reduce margins for a short period.

None of this is unexpected, and it's very likely that we will see much more of this going forward. I've said it for the last two years, a recession is not a good thing for Afterpay and for all the naysayers this could be an expensive but very valuable lesson: There is fiction and there is reality. Some posters live in a fictitious world. Many people will become smarter investors through this whole event and hopefully for holders APT will survive and thrive.

Just to end on a less gloomy note, it should be noted that the majority of reviews and comments Afterpay receives are overwhelmingly positive.