NewsBite

Black Friday proving ground for buy now, pay later providers

Black Friday is shaping up as the proving ground for buy now, pay later providers with many players posting sales records.

gave BNPL platforms a surge with many Australian players including Afterpay and Zip seeing their US operations overtake local businesses. Picture: AAP
gave BNPL platforms a surge with many Australian players including Afterpay and Zip seeing their US operations overtake local businesses. Picture: AAP
The Australian Business Network

Black Friday is shaping up as the proving ground for buy now, pay later providers with many players posting sales records.

The November retail event gave BNPL platforms a surge with many Australian players including Afterpay and Zip seeing their US operations overtake local businesses.

But analysts noted despite the strong showing from many in the sector a shake-out is looming with some companies pulling ahead and leaving fledgling players behind.

Investor darling Afterpay reported $2.2bn in global underlying sales, more than double its reported result from November 2019. Afterpay’s US customers have now exceeded 13 million. Afterpay’s Australian transaction volumes came in at $900m for November which was up 54 per cent on the year. US sales topped $1bn.

Afterpay reported 1.2 million referrals sent to US merchants from the fintech’s shop director on Black Friday.

“Black Friday continues to be the largest trading day across all regions,” Afterpay said in an update.

Top items bought across each region on the day included thermal wear in the US, beauty items and accessories in Britain and kids’ clothing, toys and beauty products in Australia, Afterpay said.

Australian fintech rival Zip reported a record result across all regions, with US customers now topping Australia-New Zealand.

Zip reported a total transaction volume of $577m by November’s end. Australian shoppers spent $312.9m through Zip in November, while Americans splashed $264.2.6m.

But Citi analysts cautioned Zip’s entry to the British market may have come too late as the space was growing crowded.

“While Zip’s global presence is a differentiator compared to some of the smaller players and UK represents a large addressable market, given the lack of an early mover advantage, Zip may need to spend more on marketing to grow in the UK,” they said.

ASX-listed fintech Sezzle, which has only targeted the US market, reported record results with a 188.5 per cent year-on-year growth and more than 2 million active users.

The market was mixed on the BNPL results, with ZIP, Afterpay, Sezzle and Splitit all closing down in local trade on Thursday.

Commonwealth Bank-backed Swedish fintech Klarna reported a 41 per cent year-on-year growth to $18bn in sales.

David Ross
David RossJournalist

David Ross is a Sydney-based journalist at The Australian. He previously worked at the European Parliament and as a freelance journalist, writing for many publications including Myanmar Business Today where he was an Australian correspondent. He has a Masters in Journalism from The University of Melbourne.

Add your comment to this story

To join the conversation, please Don't have an account? Register

Join the conversation, you are commenting as Logout

Original URL: https://www.theaustralian.com.au/business/financial-services/black-friday-proving-ground-for-buy-now-pay-later-providers/news-story/8d8560e93194d32c52f335fbc3fc2fa6