Your Friday fix for global fintech and payments news
Buy Now, Pay Later (BNPL) features high on the agenda this week as Wirecard and Klarna combine expertise to create a new joint payment solution, plus, taking a trip down under, we look into the huge rise in popularity of BNPL, which has also started to gather traction in Australia. Australia is also in the sights of Revolut this week as it has announced plans to acquire an Australian banking licence in a bid to increase sustainability. Here’s your weekly dose of this week’s biggest payments news to keep you up to date with all that’s shaping our world this week.
- Wirecard and Klarna launch joint payment solution
- Buy now pay later goes big
- Revolut seeking UK banking licence before year enD
Global innovation leader for digital financial technology, Wirecard, and leading global payments and shopping provider, Klarna, have announced a new joint payment solution. Klarna’s three payment solutions - Pay Now, Pay Later and Klarna Financing - will now be embedded into a merchant’s checkout via a single integration using Wirecard’s digital financial commerce platform. The combined solution has the potential to spark additional revenue growth for merchants through increased order value and conversion rates. Providing a single point of contact for merchants, Wirecard will ensure seamless integration into Klarna’s merchants’ checkout page as well as processing all further payments made via Klarna. Luke Griffiths, Commercial Vice President at Klarna said: “We are proud to team up with Wirecard to combine the best of our offerings into a single solution. Our joint partnership will enhance both the merchant and end-customer experiences, while expanding our footprint to more geographies. We are looking forward to launching this attractive solution on a global scale.”
A 162% rise was noted in buy now, pay later (BPNL) downloads, according to a recent Buy Now, Pay Later Tracker®, a PYMNTS and Australian market leader Afterpay collaboration. While it started out as a low price point payment option it has reached new heights, with high end products now often available using the option. With BNPL downloads reaching the six million figure, its provision to offer delayed payments is hugely popular. Alongside the rise in its use, transaction values are also on the up. Since the introduction of BNPL in Australia, credit card use has declined, with the BNPL market expected to reach a value of $8 billion globally by 2021. The Tracker states: “Payment providers must keep global consumers’ changing payment behaviours in mind. Many are leaving credit behind, with approximately 40 percent of millennials fearing credit card debt… Payment services companies must quickly figure out credit alternatives while taking consumers’ spending fears into account.”
The neobank, Revolut, has announced its intention to acquire a UK banking licence by the end of 2020. Currently holding a banking licence in Lithuania, Revolut aims to be able to hold its UK customers’ deposits on its own balance sheet and to boost returns by the ability to facilitate direct loans. In addition to its mission to acquire a UK banking licence, Revolut is also seeking the same in Australia. Following its successful gain of a US$500 million investment from TCV in February, Revolut is now valued at US$5.5 billion, just slightly lagging behind US based challenger company, Chime. Having additional banking licences allows companies such as Revolut to grow sustainably, something viewed favourably by investors.