The news: Revolut will make a plunge into the buy now, pay later (BNPL) space, per the Evening Standard, citing an interview with its CEO, Nikolay Storonsky.
Trendspotting: Revolut is the latest company to play in both digital banking and BNPL or plan to do so. Recent examples include:
The opportunity: The neobank can quickly grow adoption of a BNPL product by aggressively promoting it to a large existing customer base. Revolut’s users who adopt BNPL may become more engaged with the neobank due to spending more time within its ecosystem and running up BNPL balances they have to monitor and pay down.
The product has greater potential for loyalty building than for driving new user growth in an increasingly crowded BNPL market. For example, in Europe it faces companies ranging from PayPal to Barclays, the Evening Standard noted. Fostering more engagement could bring Revolut closer to its goal of becoming a financial super app.
For a deeper dive into how banks are competing with standalone BNPL companies, read this article from our Payments & Commerce Briefing.
Note: This article was updated on September 10, 2021 to clarify that Square's deal with Afterpay was announced in August 2021.
11 Times SquareNew York, NY 100361-800-405-0844