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The initiative aims to get customers to pay with all of PayPal鈥檚 payment solutions鈥攆rom debit cards to buy now, pay later鈥攅verywhere they shop. Debit card TPV grew 64% YoY in Q1, and the number of Venmo and PayPal debit card users shot up almost 80% YoY. BNPL volume grew more than 20% YoY in Q1, and its monthly active accounts that use the service increased 18% YoY.

BNPL providers will race to adopt the technology. Afterpay and Klarna will do so by the end of the year. Both need to penetrate in-store sales, are building out debit card programs to do so, and would benefit from the extra interchange. This will help drive BNPL transaction value. Click here to view our full forecast for US BNPL payment value.

Between buy now, pay later (BNPL) players like Affirm and mobile wallets like Cash App and PayPal, the number of fintech cards on the market is growing. Affirm Card gross merchandise volume (GMV) jumped 113% YoY in the quarter ending December 31, 2024. And the number of active Cash App cardholders increased by 1 million in 2024.

Gen Zers are trading down to debit cards or other alternatives like buy now, pay later (BNPL), potentially eroding payments volume, swipe fee revenues, and interest income for issuers. Our take: Issuers improve Gen Zers鈥� relationship with credit cards by being transparent about interest rates and other fees.

Modernizing BNPL. BNPL isn鈥檛 new to Latin America鈥攊t鈥檚 the digital evolution of a decades-old habit. In Venezuela, the Cashea app gained 1.2 million users in just over a year from launch by offering four interest-free payments and charging only for missed ones, per Bloomberg.

Nonmerchant partnerships: The buy now, pay later (BNPL) provider scored a partnership with JPMorgan Payments, making the BNPL option available to merchants using JPMorgan鈥檚 Commerce Solutions Platform. Klarna also joined the JPMorgan Payments Partner Network, which connects the bank鈥檚 clients to a broader payments and technology ecosystem.

The agency has dropped its lawsuit against Zelle and is expected to scrap its BNPL rule. Its rule to regulate apps like Apple Pay and Google Wallet as banks is also being undone by Congress.

Cash App offers direct deposit, a debit card, a high-yield savings account, and two lending products: the buy now, pay later (BNPL) service Afterpay and Borrow. Dorsey wants to ramp up its offering with wire transfers, check deposits, and bill pay, per Block鈥檚 Q3 2023 shareholder letter. Cash App started piloting Borrow in 2020.

he policy targets deceptive practices, requiring companies to make it as easy to cancel as it is to sign up. Opponents say it鈥檒l increase accidental unsubscribes.

"Even small changes鈥攍ike showcasing buy now, pay later (BNPL) options earlier in the purchase journey or optimizing product pages for search鈥攃an make a significant impact.". Invest in trust and engagement. Consumers are drawn to brands they trust. Utilize user-generated content, detailed product descriptions, and demo videos to build credibility.

Buy now, pay later (BNPL) payment value will rise 14.8% annually from 2023 through 2027, as BNPL fintech leaders adapt to a maturing market by diversifying product offerings and harnessing demographic trends.

The CFPB said it would stop enforcing BNPL companies under the interpretation of Reg Z. It asked a Texas judge to scrap the $8 credit card late fee cap. The agency dropped its lawsuit against Zelle, Bank of America, JPMorgan, and Wells Fargo. Vought also zeroed out the CFPB鈥檚 funding for the year and tried to fire 80% of the agency鈥檚 employees. But the open banking rule seemed to be on safer ground.

How we got here: Apple Pay started partnering with BNPL players like Affirm shortly before shutting down its in-house Apple Pay Later offering. At the time, Apple said it planned to offer card-linked installments from Synchrony, Citi, and Fiserv. Apple Pay has since added Klarna as a BNPL option as well.

That鈥檚 why Google Wallet also recently started supporting more types of digital passes, virtual cards, and BNPL options. Feature innovation will be a crucial differentiator if Google decides to compete for users in Apple鈥檚 home turf: the iPhone. Our take: Launching this account for kids can help Google Wallet grow its user base in the long term by bringing in consumers early in their financial lives.

Yeah, and I think, so BNPL delinquencies is something I've followed closely of like how many people are not paying off their BNPL debts and those are actually much lower than credit cards. People are paying off their BNPL debts. Rob Rubin (08:10):. All right. Grace Broadbent (08:10):. But the issue that it creates is that they now have less money to pay off their credit card debt. Rob Rubin (08:10):.

The news: Klarna expanded its distribution partnership with Stripe, making the buy now, pay later (BNPL) option available to merchants in 26 countries, per CNBC. Stripe merchants will be able to A/B test the impact Klarna has on their conversion rates. As part of the new deal, Stripe will get a share of the fees that Klarna makes from each transaction.

The number of buy now, pay later (BNPL) service users in the US will grow by 34.4% this year to reach 91.5 million, per our August 2024 forecast. Use this chart: Marketers can use this chart to strategize how to message essential products to consumers should tariffs or a trade war increase prices. Retailers can use this chart to craft initiatives around highlighting essential products if prices rise.

Apple鈥檚 credit card, BNPL product, and savings account put it in direct competition with financial services incumbents. With 130.1 million US iOS users loyal to its unsurpassed UX and dominant digital platform, the threat will only grow.