Earlier this month, news came out that Apple is putting together a buy now, pay later (BNPL) service that will allow consumers to pay for their Apple Pay purchases in installments over time.

Almost immediately after the announcement, shares of BNPL incumbents were hit: Nasdaq-listed Affirm Holdings fell 10%, while Australia-listed Afterpay slumped 9.6%.

BNPL has a self-explanatory name, but what’s so special about it that Apple’s interest could send out such large shockwaves? The service makes it easier to buy things, but what are the social implications of such access?

In this episode of Tech in Asia Explains, Hoolah CEO and co-founder Stuart Thornton and Tech in Asia journalist Melissa Goh give us a guided tour of BNPL, taking us through the attractions and pitfalls of this emerging world.

Tech in Asia Explains is a Tech in Asia Originals series that dives into the latest trends in the tech and startup scene, getting insights from leading personalities from within the industry.

Transcript:

Nathaniel:
QR codes, contactless payments, mobile wallets: These are just some ways that you and I have begun to pay for things over the past few years. But recently, there emerged a new kid on the fintech block that’s been gaining popularity: Buy now, pay later or BNPL for short.

High-profile players like Grab and Shopee, and even PayPal and Mastercard have started to get into the game, so there’s no better time to suss out what exactly buy now, pay later is, why it’s leaving such a mark, and what’s next for the rising industry.

Welcome to Tech in Asia Explains: Buy now, pay later.

So, what is buy now, pay later? Well, it’s in the name. You buy something now and then you pay for it later, over a series of regular installments. The payment mode was born in Sweden in 2005 with a startup named Klarna and is marketed as a consumer-friendly alternative to credit cards and bank loans.