Atome’s profit surge cannot mask BNPL’s underlying problems

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A lot has been said of how Southeast Asia’s buy now, pay later players have bucked gloomy global industry trends, benefiting from BNPL’s relative nascency in the region and avoiding the rough patch that their more established counterparts such as Klarna, Afterpay, and Affirm are facing in Western markets.

At first glance, Atome’s 2021 results would suggest that the benefit of the doubt given to Asia-based firms in the industry is largely warranted. But a closer look at the earnings report will reveal that the Singa​​pore-based BNPL service does share certain worrying underlying trends with its struggling global peers.

For instance, Atome saw its marketing expenses balloon nearly 5x last year, hinting at the intensifying competition in reaching target audiences.

This is a trend shared by troubled BNPL giants Klarna, Affirm, and Afterpay, who have had to spend heavily on advertising to stave off both established players such as PayPal and Apple, as well as a growing number of BNPL upstarts.

In today’s featured piece, Tech in Asia dissects Atome’s latest earnings report, which not only brings to fore the firm’s encouraging profit and revenue growth rate but also highlights how the Advance Intelligence Group-owned company has pivoted to focus on different Southeast Asian markets.

Today we look at:

• Atome’s profits nearly tripling in 2021
• M-Daq Global’s expansion plans in Japan
• Other newsy highlights such as Trust Bank’s flying start in Singapore and Vietnam’s Propzy winding down its businesses.

Also, if you’re an entrepreneur looking for funding, fill out this form to get your company featured on our list of fundraising startups.

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Not solely reliant on BNPL

Image credit: Timmy Loen

BNPL’s rise to prominence was boosted amid the pandemic as consumers with tighter wallets looked for alternative payment methods to avoid paying interest on credit card bills. However, as the BNPL industry slowly matures amid increasing competition in Southeast Asia, incumbents will need to diversify their revenue streams.

Atome is evidently well prepared in that department, given that slightly more than half of the firm’s 2021 revenue was actually generated by its peer-to-peer lending business in Indonesia.

Headed for the Land of the Rising Sun

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