“[BNPL startups are] being forced to really figure out their...

“[BNPL startups are] being forced to really figure out their path towards sustainable profitability

"But this apprehension doesn’t seem to have trickled down to investors in Europe: newer entrants into the BNPL sector continue to rake in sizeable rounds from global investors.

Meanwhile, Visa, Mastercard, Barclays, PayPal, Revolut and Monzo are all fighting for a slice of the BNPL pie.

Although market penetration for BNPL is smaller in the US than in Australia, Jeff Tijssen, global head of fintech at the consultancy Bain & Co, points out that it’s still a pretty tough environment.

“I’d say the US market is just as competitive, if not more, compared to what we’re seeing in the UK,” Tijssen says. “Yes, some of the underlying unit economics may vary so you’re able to charge more from your merchants and consumers, but that doesn’t take away from the fact that it’s not all about Klarna,” he adds, citing other big players like Affirm.

Tijssen believes that in the long-term, the share price turmoil is a good thing for the sustainability of the sector.

“Now that these businesses are coming under increased levels of scrutiny from the investor community, they’re being forced to really figure out their path towards sustainable profitability, as opposed to international expansion and hyper-growth at all costs.” Source: Sifted - 03/22