Square plans to acquire Australian company Afterpay, which offers a “buy now, pay later” service that allows you to pay interest-free installment purchases for $29 billion in inventory, the two companies announced on Sunday. It’s the latest major move for Square, which has also announced a Bitcoin business unit and that it has bought a majority stake in the Tidal streaming service this year.
“Buy now, pay later” services such as those offered by Afterpay, Affirm, and Klarna are becoming more and more common on the web. And Square may not be the only payment giant to jump in the ring, as Apple is reportedly working on a similar proprietary service internally called “Apple Pay Later.”
According to a press release, Afterpay already serves more than 16 million customers and nearly 100,000 merchants worldwide. Square and Afterpay expect the transaction to close in the first quarter of 2022. Once the acquisition is completed, Square will appoint an Afterpay executive to join Square’s board.
“Square and Afterpay have a common goal. We’ve built our business to make the financial system fairer, more accessible and more inclusive, and Afterpay has built a trusted brand aligned with those principles,” Square co-founder and CEO Jack Dorsey said in a statement. “Together, we can better connect our Cash app and merchant ecosystems to deliver even more compelling products and services to merchants and consumers, empowering them again.”