In Australia, Gen Z and millennials will soon be able to open a banking account with Afterpay as the global BNPL firm prepares to launch a customer deposit product. In July 2021, Afterpay announced the expansion of its services into online banking. Notably, the BNPL firm developed new money, and lifestyle application called Money. The company is expecting the Money app is to become the primary banking solution for Gen Z and millennial consumers.
According to PayNXT360’s Q4 2020 BNPL Survey, BNPL payment in the country is expected to grow by 58.6% on annual basis to reach US$ 11,665.2 million in 2021.
Medium to long term growth story of BNPL industry in Australia remains strong. The BNPL payment adoption is expected to grow steadily over the forecast period, recording a CAGR of 24.0% during 2021-2028. The BNPL Gross Merchandise Value in the country will increase from US$ 7,354.4 million in 2020 to reach US$ 52,456.2 million by 2028.
Afterpay has dominated the BNPL market in Australia, primarily driven by Gen Z and millennial online shoppers in the country. Capitalizing on this, Afterpay hopes to drive younger consumers away from bigger banks and other banking platforms in Australia with its newly launched banking application, Money. The new app is expected to be available for Australians in October 2021. Once it is available, more than one million Afterpay users will be able to use their existing credentials for accessing the Money interface.
Moreover, the app will allow users to manage their accounts with physical debit cards, e-wallet offerings, and the ability to make payments in real-time with no additional fees. Additionally, the new app will allow users to earn up to 1% interest rate per annum.
Through the Money app, the BNPL firm aims to transform the use of its deferred payment app into a long-term budgeting tool, which consumers can integrate into their everyday lives. The BNPL firm aims to broaden its relationship with loyal customers while attracting new customers looking to streamline how they manage their finances.
The Australian Financial Service License (AFSL) obtained by Afterpay allows the company to provide financial product advice and distribute debit cards and basic deposit products. Afterpay partnered with Westpac, acting as the regulated card issuer and a deposit account for this new app.
Ultimately, through Money, Afterpay aims to make money management simple, frictionless, and stress-free for Gen Z and millennials in Australia.
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