Outlook on the Buy Now Pay Later Market in South Africa to 2028 - Featuring Mobicred, More Tyme, Payflex, Pay Just Now and PayUp

DUBLIN, Nov. 2, 2022 /PRNewswire/ -- The "South Africa Buy Now Pay Later Business and Investment Opportunities - 75+ KPIs on Buy Now Pay Later Trends by End-Use Sectors, Operational KPIs, Market Share, Retail Product Dynamics, and Consumer Demographics - Q3 2022 Update" report has been added to  ResearchAndMarkets.com's offering.

According to the publisher, BNPL payments in the country are expected to grow by 70.4% on an annual basis to reach US$810.4 million in 2022.

Medium to long term growth story of BNPL industry in South Africa remains strong. BNPL payment adoption is expected to grow steadily over the forecast period, recording a CAGR of 35.5% during 2022-2028. The BNPL Gross Merchandise Value in the country will increase from US$475.5 million in 2021 to reach US$5,013.8 million by 2028.

The buy now pay later (BNPL) industry is a fast-growing segment in South Africa, as consumers increasingly seek ways to manage their tight budgets. Amid the growing consumer demand, the payment method has become the preferred option among merchants, driving the BNPL transaction value and volume.

Over the last few years, several domestic players have launched BNPL products in South Africa, including Payflex, Tyme Bank, and PayJustNow. With thousands of merchants offering these BNPL solutions, the product's penetration is expected to record strong growth over the next three to four years.

Globally, there has been a high degree of mergers and acquisition activities in the space, and the trends are similar in South Africa. In September 2021, Payflex was acquired by Australia-based BNPL firm Zip, while in February 2022, Homechoice acquired PayJustNow. Amid the growing BNPL market across the African region, foreign players are also considering expansion in the continent, including in South Africa.

This trend is expected to drive more investment in the South African BNPL market over the next three to four years, which will subsequently drive innovation and competition in the sector from the short to medium-term perspective.

South African consumers prefer and recommend BNPL services over regular banking services

The growth of the BNPL market can be estimated by the rising adoption and usage of BNPL services among consumers. In South Africa, more and more consumers are using the services while also recommending them over regular banking options. For instance,

• A May 2022 report from Payflex, one of the leading BNPL providers in South Africa, revealed that South African consumers prefer and recommend BNPL services over regular banking services. The survey of 7,300 customers of BNPL gave the Payflex BNPL service a net promoter score of +82, which is an indication that customers will recommend the service to others.
• Of the 89% of the South Africans who have used the BNPL option in the last three months, leading to May 2022, plan to continue using the service in the next six months, according to the survey. Notably, Payflex, which has been acquired by Zip, is available at more than 1,500 online merchants and is now seeking to make inroads into the physical retail space.

With consumers demanding the availability of the BNPL payment method at more merchants in the country, the strategy to expand its presence in the offline segment can further accelerate the growth of Payflex over the next three to four years.

Firms are entering into strategic alliances to offer BNPL payment options across different product categories

In South Africa, consumers are demanding the availability of the flexible payment option at more merchants, which can offer them a greater choice when completing specific purchases. Consequently, BNPL players are entering into strategic alliances with merchants in the country. For instance,

• In February 2022, ImaliPay, a fast-growing Pan-African Fintech platform, announced that the firm had entered into a strategic alliance with TiAuto Investments, a South African firm that operates in the automotive industry. Under this partnership, ImaliPay and TiAuto Investments will offer a BNPL payment option to consumers for car accessories purchases in South Africa.

Over the next three to four years, the publisher expects BNPL players to further expand their footprint and offer the BNPL payment option across different product categories through strategic collaborations with merchants in South Africa. This will assist the growth of the overall gross merchandise value from the short to medium-term perspective.

BNPL providers are targeting the B2B segment to drive the next growth phase in South Africa

Globally, BNPL providers are targeting the B2B segment to drive the next growth phase after gaining widespread popularity among consumers over the last two years. Similar trends are visible in South Africa, where BNPL providers target the B2B segment in 2022. For instance,

• In March 2022, Payflex and Merchant Capital, the two South African Fintech firms, announced the launch of a cash advance solution that aims to offer credit services to small and medium-sized retailers in the country. Under the collaboration, the firms have launched FlexiAdvance, the service which will offer SMEs access to funding within 24 hours of application.
• In South Africa, Payflex merchants have achieved 30% higher average order values by offering the BNPL service to customers. The new value-added service, FlexiAdvance, is projected to further assist SMEs in accelerating their business growth by accessing funding through the Payflex platform.

As the credit demand among SMEs grows in South Africa in times of global economic uncertainties, the publisher expects more firms to enter into the B2B BNPL segment in South Africa in the short to medium-term.

Scope

This report provides in-depth, data-centric analysis of Buy Now Pay Later industry in South Africa. Below is a summary of key market segments:

South Africa BNPL Market Size and Spending Pattern

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

South Africa Buy Now Pay Later Operational KPIs

• Buy Now Pay Later Revenues, 2019 - 2028
• Buy Now Pay Later Share by Revenue Segments
• Buy Now Pay Later Merchant Commission, 2019 - 2028
• Buy Now Pay Later Missed Payment Fee Revenue, 2019 - 2028
• Buy Now Pay Later Pay Now & Other Income, 2019 - 2028
• Buy Now Pay Later Accounts, 2019 - 2028
• Buy Now Pay Later Bad Debt, 2019 - 2028

South Africa Buy Now Pay Later Market Share Analysis by Key Players

•  (Mobicred, More Tyme, Payflex, Pay Just Now, PayUp)

South Africa Buy Now Pay Later Spend Analysis by Channel: Market Size and Forecast

• Online Channel
• POS Channel

South Africa Buy Now Pay Later in Retail Shopping: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

South Africa Buy Now Pay Later in Home Improvement: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

South Africa Buy Now Pay Later in Leisure & Entertainment: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

South Africa Buy Now Pay Later in Healthcare and Wellness: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

South Africa Buy Now Pay Later in Other: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

South Africa Buy Now Pay Later Analysis by Consumer Attitude and Behaviour

• Buy Now Pay Later Sales Uplift by Product Category
• Buy Now Pay Later Spend Share by Age Group
• Buy Now Pay Later Gross Merchandise Share by Income
• Buy Now Pay Later Gross Merchandise Value Share by Gender
• Buy Now Pay Later Adoption Rationale Gross Merchandise Value Analysis

Reasons to buy

• In-depth Understanding of Buy Now Pay Later Market Dynamics: Understand market opportunities and key trends along with forecast (2019-2028). Understand market dynamics through essential KPIs such as Gross Merchandise Value, Volume, and Average Value Per Transaction.
• Insights into Opportunity by end-use sectors - Get market dynamics by end-use sectors to assess emerging opportunity across various end-use sectors.
• Develop Market Specific Strategies: Identify growth segments and target specific opportunities to formulate BNPL strategy; assess market specific key trends, drivers, and risks in the BNPL industry.
• Get Insights into Consumer Attitude and Behaviour: Drawing from proprietary survey results, this report identifies and interprets key Buy Now Pay Later KPIs, including spend by age, gender, and income level.
• Market Share by Key Players

For more information about this report visit https://www.researchandmarkets.com/r/uotgx6

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