Buy Now, Pay Later platform Afterpay has quickly returned the serve after Commonwealth Bank launched its own BNPL scheme earlier this week.
The payments giant is preparing to release a banking app named Afterpay Money, which will target the customers of Australia’s big four banks.
It is the second time in days BNPL and banking have joined forces, after CBA revealed it would be offering a BNPL product to customers within its app.
According to The Australian Financial Review, Afterpay’s banking app will be very different to what banks such as Westpac, ANZ, Commbank and NAB offer.
“We are not building another ‘me too’. There are some functions, like capturing a deposit and making payments, that are the same. But the experiences we build around that will be like nothing a bank, or a neobank, would do,” Afterpay executive Lee Hatton told the publication.
Afterpay’s banking app Afterpay Money was first announced in the company’s half-year results last month.
Afterpay Money will be a stand-alone app and is on track to launch in Q1 2022 with a pilot underway and testing slated for Q4 2021.
App customers will be able to make Afterpay Money their primary money management app, complete with a linked debit card. Salaries will be able to be paid onto the account directly and money can also be transferred to other financial accounts.
The app will also be integrated with Afterpay’s BNPL scheme, with upcoming Afterpay payments displayed within it.
“The user experience is more like a shopping experience than it is a banking experience. It doesn’t look like, here are your accounts and here are your balances. It’s more around things like, what are the things in my wish-list at the moment that I am saving for,” Hatton added.
Hatton said banks should be “nervous” at the magnitude of what Afterpay Money can offer, in conjunction with its exiting BNPL scheme.
“Why should banks be nervous?” We have a deeply engaged consumer that trusts us that we can find offers to help them navigate life more effectively in a way that resonates with them. It is colourful and beautiful,” she added.
This week, CBA announced its new Buy Now, Pay Later offering which is available to eligible banking customers with a Commbank debit or credit card.
The scheme will allow transactions of up to $1000 paid in four equal fortnightly instalments.
“As the leading digital bank in Australia, we believe we are best placed to offer our customers a prudent and responsible BNPL option based on the trends and insights sourced from real time transaction data over many years,” CBA’s Group Executive, Retail Banking Services, Angus Sullivan said.
