PayPal is set to acquire Paidy, a Japanese 'buy now, pay later' (BNPL) company for ¥300 billion (approximately US$2.7 billion).
PayPal said that the acquisition will help to expand its capabilities, distribution, and relevance in the domestic payments market in Japan and complement its existing cross-border e-commerce business in the country.
"Paidy pioneered buy now, pay later solutions tailored to the Japanese market and quickly grew to become the leading service, developing a sizeable two-sided platform of consumers and merchants," said Peter Kenevan, vice president and head of Japan at PayPal.
"Combining Paidy's brand, capabilities and talented team with PayPal's expertise, resources and global scale will create a strong foundation to accelerate our momentum in this strategically important market."
Paidy allows Japanese shoppers to make purchases online and then pay for them each month in a consolidated bill at a convenience store or through a bank transfer. The company said it uses proprietary technology to score creditworthiness, underwrite transactions, and guarantee payment to merchants. It also helps consumers “feel comfortable and safe” while shopping online and drives increased conversion rates, average order values and repeat purchases for merchants.
The company has over six million registered users and has integrations with PayPal and other digital and QR wallets through Paidy Link.
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"Paidy is just at the beginning of our journey and joining PayPal will accelerate our plans to expand beyond e-commerce and build unique services as the new shopping standard," said Riku Sugie, president and CEO of Paidy. "PayPal was a founding partner for Paidy Link and we look forward to working together to create even more value."
At the beginning of August, Jack Dorsey’s financial services company Square was set to acquire Afterpay for around $29 billion, breaking the record for a completed Australian buyout. Afterpay is another BNPL platform that lends shoppers, who are exempt from credit checks, money they can pay off later, interest-free. Square planned to integrate Afterpay into its existing Seller and Cash App business units and allow “even the smallest of merchants” to offer BNPL at checkout.
