The digital commercial payment giant Square announced on August 1 that it would acquire the Australian payment platform Afterpay for 39 billion Australian dollars ($29 billion US dollars).
Square will acquire all the issued shares of Afterpay in the form of a stock purchase, and it is expected to complete the acquisition in the first quarter of 2022.
The acquisition aims to use Afterpay’s leading “buy now, pay later” (BNPL) tool to strengthen and enable further integration between its seller and cash app ecosystems while integrating its global merchant base to accelerate the development of square’s business.
The Co-Founder and CEO of Square Jack Dorsey commented on the acquisition:
“Together, we can better connect our Cash App and Seller ecosystems to deliver even more compelling products and services for merchants and consumers, putting the power back in their hands.”
Afterpay is the world’s leading “buy before you pay” (BNPL) platform. BNPL transactions are also called instalment loans, allowing customers to pay bills in a small portion within a fixed period of time, and are especially popular with the younger generation.
Afterpay co-founders and co-CEOs Anthony Eisen and Nick Molnar said that:
“By combining with Square, we will further accelerate our growth in the U.S. and globally, offer access to a new category of in-person merchants, and provide a broader platform of new and valuable capabilities and services to our merchants and consumers.”
After integrating the two parties, Afterpay consumers can manage their instalments through the Cash App and get BNPL discounts.
The acquisition is believed to allow Square to provide its customers with options to escape the traditional consumer demand for credit.
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