The Australian Buy Now Pay Later Gross Merchandise Value is Expected to Reach $119 Billion by 2028

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Nov 07, 2022, 08:30 ET

DUBLIN, Nov. 7, 2022 /PRNewswire/ -- The "Australia 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 57.0% on an annual basis to reach US$22,062.3 million in 2022.

Medium to long term growth story of BNPL industry in Australia remains strong. BNPL payment adoption is expected to grow steadily over the forecast period, recording a CAGR of 32.5% during 2022-2028. The BNPL Gross Merchandise Value in the country will increase from US$14,056.7 million in 2021 to reach US$119,277.8 million by 2028.

Australian consumers have been one of the early adopters of the buy now pay later (BNPL) payment method globally. The explosion in the popularity of the BNPL payment method during the global pandemic outbreak has seen many traditional financial services firms, including banks, rapidly move into the BNPL space, either in collaboration with established BNPL providers or introducing their deferred payment service, despite initial hesitancy and skepticism about these payment arrangements.

The medium to the long-term growth outlook for the BNPL sector remains strong in Australia, as payment adoption is expected to grow steadily among consumers across different age groups. Recent moves by BNPL providers, such as Afterpay, also indicate where the next growth phase of the BNPL industry may come from. The Australia-based firm, which Square has acquired, is making inroads in the physical retail segment by integrating the BNPL payment method with in-store point of sale solutions offered by Square.

Over the next three to four years, the publisher expects in-store growth to overtake the online BNPL segment in Australia. With the enormous market reach offered by mobile payments, integration of BNPL services with digital wallets like Apple and Google Pay presents enormous new addressable markets.

Banking institutions continue to enter the deferred payment segment with BNPL product launches in Australia

With Australian consumers increasing their BNPL spending aggressively, the once hesitant traditional banking institutions continue to enter into the deferred payment segment by launching their BNPL services. Introducing these new BNPL services in the Australian market is expected to further pressure existing operators. For instance,

In May 2022, National Australia Bank (NAB) announced the launch of the BNPL service. This made the bank the third of the big four banks in Australia to offer BNPL products to customers. The bank started offering the NAB Now Pay Later services from July 2022 using the existing Visa credit card system. This means that the bank will not have to sign up merchants just like the standalone operators such as Afterpay and Zip do. The entry of NAB into the BNPL segment will put additional pressure on standalone operators who are battling corporate losses amid rising interest rates which have made it harder for players to survive.

The BNPL service of NAB comes on top of similar services launched by CBA and ANZ, which leaves Westpac the only one of the big four currently not providing a BNPL product. For existing pure-play BNPL operators, the entry of banks will further cause a massive squeeze in the segment, as the market in Australia has already peaked, and growth is expected to slow down from the short-term perspective.

BNPL providers are expanding their services into new product categories to drive growth amid rising competition

Amid the growing competition in the Australian BNPL industry, firms are expanding their services into new product categories to gain more traction among consumers and drive growth. For instance,

In March 2022, Fupay, the Australian Fintech firm, announced that it is expanding BNPL products to petrol and groceries. After expanding into rent in 2021, the domestic BNPL player announced new partnerships in the fuel and grocery sector with United Petroleum, IGA Marketplace, and Foodworks. This move comes amid an expansion in payments services across the board, as emerging Fintech firms continue to compete and challenge the big banks.

Along with new BNPL players, established global giants such as Afterpay are also launching the service across the different segments. For instance,

In March 2022, Afterpay announced that the firm had entered into a strategic collaboration with DoorDash, one of the leading global food delivery platforms. Under the strategic alliance, DoorDash customers will be able to use the BNPL service offered by Afterpay while ordering food from the aggregator.

The publisher expects the trend to grow further into momentum as players seek to expand their services into more product categories amid the growing competition in the Australian BNPL market.

Mergers and acquisitions deals are expected to increase as players consolidate to survive the increased competition and rising interest rates

In 2022, the BNPL sector in Australia is likely to see more mergers and acquisition deals as firms consolidate to survive the increased competition and rising interest rates. Notably, Australia is expected to start hiking interest rates from a record low during the pandemic later this year. With firms facing higher costs in borrowing funds, the margins derived from providing interest-free installment loans for shoppers at the point of sale will get reduced.

Moreover, the explosive revenue growth achieved by the BNPL sector over the last two years during the global pandemic has attracted investments from global tech giants such as Apple Inc. and PayPal Holdings Inc., which will likely crowd out smaller BNPL firms from the short to medium-term perspective. As a result of this, the publisher projects that most of the startups will either be purchased or go out of business without the ability to raise more investment for survival.

Scope

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

Australia BNPL Market Size and Spending Pattern

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

Australia 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

Australia Buy Now Pay Later Market Share Analysis by Key Players

(Afterpay, Zippay, Humm, OpenPay, Payright)

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

Online Channel
POS Channel

Australia 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

Australia 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

Australia 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

Australia 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

Australia 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

Australia 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/h6kotd

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