Afterpay Key To Attracting Millenial Shoppers
Australian buy-now-pay-later service provider Afterpay is banking on its popularity with millenials to stave off global credit giant Visa’s entrance into the market it estimates could be worth A$1.7 trillion globally per year.
Afterpay founder Nick Molnar told the Sydney Morning Herald his company “plays a core part” of retailer strategies to attract millennial shoppers, who made up over 40 per cent of the more than 1.5 million Australians who used BNPL services in the 12 months to January 31 this year.
Visa’s service would be available to its existing cardholders, but Afterpay believes its millennial customers will help act as a “moat” protecting it, given many of them don’t have and aren’t interested in getting credit cards.
A report commissioned by Afterpay earlier this year found almost two-thirds of Australian millennials don’t own a credit card, compared to two-thirds of older Australians who do.
Mr Molnar stepped down from his role as chief executive of Afterpay last week in a management reshuffle to establish an independent board which saw his role change to global chief revenue officer to allow him and his co-founders to focus on growing the business internationally.
While the business (and its share price) have been growing substantially, it’s not all good news for Afterpay.
As well as increasing competition from the likes of Zip, Splitit and Humm, the company is also facing a probe from federal regulators into its compliance with anti-money laundering and counter terrorism regulation.