Buy Now Pay Later or BNPL Market in Southeast Asia Is Growing Rapidly with Fintech Firms like Grab, Razer Offering Flexible Purchasing Plans

Buy Now, Pay Later (BNPL) services are being widely-adopted in Southeast Asia. BNPL service providers allow consumers to pay for products via flexible instalment plans. Major Fintechs offering BNPL options in the Southeast Asian region include Grab, GoJek, Razer, Oriente, among others.

BNPL lets people make purchases and then pay them off over an extended period of time through weekly, bi-weekly or monthly installment plans. These products may offer 0% interest, pay-in-instalments and other options that can make it more manageable for people to pay for goods and services.

BNPL is a fast-growing global market that’s expected to expand from $7.3 billion in 2019 to approximately $33.6 billion in 2027 at a compound annual growth rate (CAGR) of 21.2%, according to a report from Coherent Market Insights.

The Asia-Pacific or APAC region is expected to become the world’s fastest-growing BNPL market due to the rising number of Internet users. Arount 40 million new users joined the booming digital economy in Southeast Asia in 2020, which brings the total Internet users in the region to around 400 million, according to estimates provided by e-Conomy SEA Report 2020.

According to a consumer survey by Finder (released in October 2020), there are around 1.1 million Singapore residents, or 38% of the nation’s population, that have used some type of BNPL service, indicating that the trend is becoming quite popular in the country and region following the COVID-19 outbreak. As confirmed in numerous reports, the Coronavirus pandemic has accelerated the shift to all-digital platforms and services including e-commerce and increasing numbers of mobile payments being conducted.

Singapore’s Hoolah, a BNPL service provider for digital commerce platforms, recently revealed that transaction volumes on their platform increased more than 7 times (as of October 2020) in the past 6 months. Hoolah also mentioned that the number of partnered retail stores increased 280% to 1,000 from October 2019 to October 2020.

Hoolah, which offers BNLP options in Malaysia, Singapore, and Hong Kong, is planning to expand its business operations into other markets.

Razer Fintech, the Fintech division of Singapore-based gaming company Razer, is also  one of the latest businesses to join the BNPL market, confirming a partnership with BNPL platform Rely last month.

As reported recently, Twisto, a BNPL Fintech, has received a €16 million investment led by Zip Co and Elevator Ventures. Limepay, another BNPL provider, was recently selected by Domain (ASX:DHG)  – an Australian property marketplace – to provide credit services with a new product called “MarketNow” according to a note from the company

Digital travel platform Agoda has partnered with BNPL Fintech Atome to offer instalment plans to Malaysia and Singapore consumers.

Many BNPL Fintechs in Australia are not properly regulated, which poses serious risks, an industry executive claims.

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