Will big banks tank BNPL startups?

IN FOCUS

In today’s newsletter, we look at:

• Why Indonesia’s BNPL startups are at risk from banks
• Why incentives matter when corporations incubate startups

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Welcome to The Top Up! Delivered every fortnight via email and through the Tech in Asia website, this free newsletter breaks down the biggest stories and trends in fintech. Get it in your email inbox by registering here.

Hi there,

I used buy now, pay later to purchase an iPad many years ago.

Given the gadget’s relatively high cost, it made sense to space out the payments over 12 months. On the downside, though, I wasn’t able to earn any miles or rewards on my credit card.

If I had to do it again, would I use BNPL? It would depend on my current financial situation. If I could afford to make the payment in one go, I would definitely put it on my credit card since I don’t want to miss an opportunity to earn miles.

This issue of whether banks’ BNPL offerings could cannibalize their credit card business is raised in this week’s featured story by my colleague Glenn.

BNPL solutions offered by banks are taking off in Indonesia. While these services are relatively new, the amounts of credit disbursed through them already exceed those provided by non-bank fintech companies – including pioneers in the space such as Akulaku and Kredivo.

Will banks, whether in traditional or digital form, eventually eliminate the need for BNPL startups? Read Glenn’s piece to find out more.

Meanwhile, in this week’s Hot Take, I take a closer look at HSBC’s decision to close its payments business Zing.

— Simon

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THE BIG STORY

Indonesia’s banks are taking over BNPL. Can fintech firms survive?

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THE HOT TAKE

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The practice will pay off at #TIAConference2025

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