Buy now, pay later, shop whenever

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Hello readers,

I don’t actually do much shopping, so learning about the emergence and rapid growth of “buy now, pay later” (BNPL) schemes that offer interest-free payment plans was interesting. For me, if I can’t afford to buy something, I just don’t. The thought of spreading out the cost in several payments doesn’t appeal to me either – in life, I generally prefer to rip the band-aid off quickly.

That said, I understand that I may be speaking from a position of privilege. To many people, BNPL is an essential option, going by the growth numbers of firms in the vertical. And with ecommerce’s upward trend not ending anytime soon, BNPL could be riding high before long.

Today we look at,

• The rise of BNPL in Southeast Asia
• Byju’s latest billion-dollar acquisition
• Other newsy highlights such as Tesla making its first steps into India and YouTube putting the clamps on Donald Trump

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PREMIUM SUMMARY

Kicking the can down the road

“Buy now, pay later” options are sprouting up everywhere. Besides dedicated players like Atome, Rely, and Hoolah, ecommerce platforms like Shopee as well as super app Grab are also offering such services. Anything to help the customer spend, I suppose.

• On the up: Singapore-based BNPL firm Hoolah says total transactions processed on its platform grew over 700% from the beginning to the end of 2020. Last year, total transactions on fellow BNPL startup OctiFi grew over 40% month on month, while Rely grew “more than 8x” last year on a gross merchandise value basis.
• On/offline? Players in Singapore expect that a majority of pay-later sales will continue to come from online commerce, but some, like OctiFi, are looking to offline segments. The startup is focusing on offline retailers that struggle to digitalize and remain relatively underserved by digital payment players. These range from retailers in mobile and electronics sectors to those selling motorcycles.
• It’s a regional thing: Like everything in digital payments, the BNPL model relies on scale. As they grow, firms in Singapore will look beyond the city-state to countries like Indonesia, Malaysia, and the Philippines.

Read more: ‘Buy now, pay later’ heats up in Singapore with Grab, Mastercard entering the scene

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STARTUP SPOTLIGHT

Byju’s gets even bigger

India’s biggest online education startup Byju’s has signed a deal to acquire brick-and-mortar test prep leader Aakash Educational Services for US$1 billion.

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What founders need to know about exit strategies

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