Credit Cards Dumped; Buy-Now, Pay-Later Services Preferred
SYDNEY: Credit card use is on the decline as millennials move to the buy-now, pay-later model, currently dominated by Afterpay and Zip. The two companies alone now have 5.4 million customers in Australia.
But consumer advocates say the sector should be regulated like credit-card companies.
The fin-tech sector, however, argues that imposition of the old rules shouldn’t apply to it.
The model has proved popular among young people who have dumped their credit cards. Only about 40 percent of young people own credit cards today, compared to 60 percent two decades ago.
Researcher IBISWorld forecasts the “buy now, pay later” industry will grow from bringing in about $679.9 million in revenue this financial year to $1.1 billion by 2024-25.
Corporate watchdog ASIC is reviewing the sector and will hand down its findings in October.