Regardless of whether your wallet is flat or not, open your mobile phone to get the credit limit, buy it in installments first, and then pay it back slowly later.

Recently, this payment model called "buy now, pay later" has become very popular abroad.

And it is often abbreviated as BNPL (Buy Now, Pay Later).

Let’s put it this way, according to data reported by Global Payments, 2% of the total global online shopping last year was paid by BNPL.

In this big wave, Klarna, a company from Sweden that specializes in BNPL business, has quietly increased its valuation to hundreds of billions, becoming the largest in Europe and the fifth largest in the world. Unicorn companies.

Well-known brands such as ZARA, Adidas, Nike, and SHEIN also support BNPL payment.

Even Apple, a guy with thick eyebrows and big eyes, announced its own "buy now, pay later" business Apple Pay Later at the recent developer conference.

It is no exaggeration to say that in the past two years, the BNPL business has become an outlet that foreign giants are chasing crazily.

Most of the friends who saw this will probably say, isn’t this thing just lending money? Domestic major manufacturers have already played a round, and supervision has sorted out a wave of chaos. How come foreigners have never seen the market?

In fact, this BNPL is somewhat similar to domestic consumer loans at first glance, but they are quite different in form.

Today, Mr. Bad Review is going to talk to you about this "overseas Huabei" business BNPL that makes foreigners addicted and attracts giants to join the game.

First of all, we all know that the credit card system in European and American countries is quite complete. Although there are also online loan platforms, they are not as popular as credit cards in terms of popularity and tariffs.

For example, credit card interest rates in the United States are generally stable at around 15, while online loan platforms range from 8 to 36.

However, no matter how perfect it is, for young people applying for a credit card for the first time, it will take at least three or four days. After applying for the card, most of them will forget it. Know what you want to buy.

The BNPL service saw this market, and it caught the group of young people who did not have credit cards to smoke wildly.

Isn’t the credit card process long and the review slow?

BNPL is the same as Ant Huabei and Baitiao, which everyone is familiar with.

Take the Klarna platform as an example. After submitting your personal information and obtaining the credit, you can directly choose installments from the supported merchants.

From registration to final use, it only takes a few minutes.

More importantly, this thing is different from credit cards and traditional consumer loans. It does not go up for credit reporting.

I’ve heard many stories about how I missed paying off my credit card a few times and ended up not being able to get a discount on my mortgage.

This wave of operations that does not affect credit scores can be said to reduce a lot of burden on users.

In addition, in addition to being reviewed as quickly as consumer loans, BNPL’s fees are lower, even lower than credit cards.

BNPL does not charge any fees such as handling fees, management fees, annual fees, etc. that are common with credit cards. . .

What’s even more amazing is that most BNPLs don’t even charge interest. They will lend you 925 yuan and pay you back the total of 925 yuan on time without any money. I want more of you.

You must know that Huabei’s real annualized interest rate is around 15.

But starting a company is not about distributing money for charity. Since BNPL does not charge interest from people who borrow money, what do they make?

The answer is actually very simple, because in turn, we ask for money from the merchants who have used BNPL services. . .

When the user makes BNPL installment payment, the platform will directly transfer the full amount of the money to the merchant's account, and collect a commission of about 6,

Take Klarna as an example. Commissions from merchants account for about 80% of their income. Hamp; M, Nike, etc. are all its financial backers.

To put it simply, in the entire BNPL model, the platform is like a pimp who goes around recruiting customers, finding those

who are willing to spend young people, and then lend them money and let them spend money in designated stores.

It is normal for the platform to earn some handling fees because it attracts customers.

This point is quite similar to Huabei, except that Huabei does it on both sides and only charges a handling fee of about 1 from the merchant.

The biggest difference between BNPL and Huabei and Baitiao is that Huabei provides financial services, and the money behind it comes from licensed consumer finance companies, just like banks. It is regulated by the China Banking and Insurance Regulatory Commission.

This is not necessarily the case with BNPL. They do not charge interest. Whether this model is a financial service is still open to question in some countries. . . The sources of funds behind them may be diverse and unregulated.

Anyway, according to Karna’s data, after using BNPL services, customers shop more frequently and spend more money.

Maybe this is the proverbial borrowed money that goes better.

More than half of young people in the UK have used BNPL, and a fifth of the Australian population has used BNPL.

The number of stores that accept BNPL payments is also increasing. It is said that by 2030, the total size of BNPL will increase 40 times to $3.98 trillion. . .

The market is big enough, the model is feasible, and capital investors have also entered the game.

So in addition to Apple, Amazon, which has its own mall, has cooperated with the BNPL platform Affirm to join this wave of lending.

For example, Microsoft has already cooperated with Quadpay to integrate BNPL functions in its own browser.

At that time, this wave of updates was criticized by everyone as "not doing their job properly".

Users are bombarded with BNPL ads. According to statistics, more than half of young Americans have seen BNPL ads on TikTok or Facebook. Deliver.

Various promotion rewards are also emerging in endlessly, which feels a bit like the domestic takeout and taxi subsidy wars back then.

This carnival of capital makes the bad reviewers want to sigh that the end of the Internet is indeed lending.

But at the same time, the reviewer feels that BNPL still has many problems behind promoting the economy and driving consumption. . .

Because aside from those fancy business models, the essence of BNPL’s business is still lending to young people. Not to mention being immoral, the risks alone are huge.

"Coincidentally", because of this repayment model without interest, BNPL has more or less exploited some legal loopholes.

For example, the "Credit Card Act" in the United States prohibits the issuance of credit cards to young people under the age of 21, but BNPL is not under their control, so many young people under the age of 21 become Become the main user of BNPL services.

In the past two years in the United States alone, the number of young people using BNPL has increased by 300.

Also in the UK and Australia, this set of interest models has more or less helped BNPL escape some financial supervision, allowing this set of things to take root and spread better. leaf.

But as the saying goes, what is owed must always be paid back.

Australia’s FCA conducted a survey and found that 60% of the respondents were burdened with multiple BNPL bills due to excessive use of BNPL, which caused their normal life to suffer. was affected.

A BNPL company called Afterpay has a bad debt rate as high as 15, and the capital chain may break at any time.

Affirm, known as the "North American Alipay", has even engaged in asset securitization, packaging and selling various BNPL IOUs in its hands, hoping to let the market digest them The risk of some bad debts. . . It can only be said to be a bit like the subprime mortgage crisis.

As for the bad reviewer, I also checked whether there are any comparable overseas BNPL model platforms in China.

Finally, we found an app called “Xigua Pay”, which just received financing from Australia’s BNPL platform AfterPay last year.

It’s hard to comment on whether this platform is easy to use and how it is doing.

But what is certain is that this platform has been targeted by some black industry guys who specialize in small loans.

A group of old guys waiting to cash out are waiting for food in the Tieba.

So, what I want to say in the end is that although the current BNPL business model makes sense.

However, whether it is risk control or regulatory compliance issues, there is still a long way to go on a global scale.

Simply encouraging young people to overspend and overdraw their future business will not go far in the future.

After all, for those of us who have just experienced various P2P thunderstorms and fully liquidated non-compliant online loans, we have experienced many battles and have seen a lot. .