The buy-now-pay-later (BNPL) space is set to be worth $1 trillion (£866bn), according to new research from analyst firm GlobalData.
Technology companies such as Apple, Google and PayPal are predicted by GlobalData to become the leading players.
“Big tech and big payment providers can seamlessly integrate BNPL into their platforms whether they are profitable or not, pushing fintech companies with unstable revenue models out of the market,” said Maddy Irwin, subject analyst at GlobalData.
“For Visa and Apple, BNPL is not supposed to be profitable, it’s just an incentive to keep existing customers in their ecosystems.”
This was announced by the CEO of Zilch, Philip Belamant UKTN in recent interview he was skeptical of the many entrants in the BNPL market, suggesting that many were rushing into the business and might not sustain the service properly going forward.
Despite The estimate is $1 billiongiant BNPL Klarna’s rating has fallen to $6bn (£5bn) in July from $45.6bn last year, while a new round of capital is expected.
Irvine added: “By 2030, regulators will eliminate BNPL’s shady sector, limiting the need for transparency and strict credit checks. Its poor reputation will improve when a stronger base is established.’
The government in June laid out plans for the BNPL sector, requiring firms offering services to be credit-checked and registered with the Financial Conduct Authority.
Many companies are currently trying to grab a piece of the British BNPL pie with companies like Timit, pshik, Jack Dorsey Square and Revolution everyone is competing.