The Reserve Bank has updated its appraisal of buy now, pay later in the Australian economy, and an assessment that continues to dampen the hype.
According to data collected by the bank, BNPL providers processed around A$11.5 billion of purchases in the year to June 2021.
“BNPL accounts for a relatively small, though growing, share of payments in the Australian economy,” the Payments System Board annual report says.
“The value of BNPL transactions was equivalent to 1.7 per cent of Australian card purchases in the year to June, although it accounts for a significant share of transactions in certain segments.”
This is up from 1.5 per cent, based on data to March 2021.
The New Payments Platform is the high growth story in payments.
The NPP now accounts for over 20 per cent of the total number of account-to-account payments, while the number of direct entry payments has been declining over the past few years, the PSB says.
The number of DE payments fell by around 2 per cent in 2020/21, the PSB says, although DE payments continue to account for the bulk of electronic retail payments by value.
The NPP’s new ‘PayTo’ service, scheduled to be launched in mid 2022, will bring direct debit-like functionality, will likely drive further migration of DE payments.
More than 105 entities, including some non-bank payment service providers, are now offering NPP payment services to their customers, and most bank accounts are now able to send and receive NPP payments.