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Apple's pay-later venture is that bit more complicated than previous incursions into consumer finance such as the Apple Card. That is because Apple itself, in the form of a standalone subsidiary called Apple Financing, will be responsible for the underwriting. With a majority of Americans now using Apple rather than Android for their mobile needs, the volume of lending decisions in the world's most valuable consumer-finance market could be simply enormous – which may explain why Apple Pay Later may well arrive next year rather than this, with "technical and engineering" snags being cited by the company as reasons for the delay.
Meanwhile, Amazon and Affirm are bringing their own successful BNPL partnership north of the border: Amazon Canada customers choosing Affirm when checking out with a purchase of $50 or above undergo a soft credit check that determines the repayment terms that can be offered. Affirm's founder, Max Levchin, has been keen to point out that his company, unlike others in the field, underwrites every loan itself, not content to accept defaults as the price of building market share.
It appears that Mastercard has landed a new brand partnership in online food delivery with what should be a high-profile credit card launch with DoorDash and JPMorgan Chase. The latter pair have been collaborating since the beginning of this decade, offering tailored benefits for DoorDash members carrying Chase cards, including some co-branded products. The new credit card will come with benefits for non-DoorDash spend, though details have yet to be publicised. Uber Eats' biggest rival in its domestic market, DoorDash became increasingly popular during the pandemic.
Across the Atlantic, the chief executive of JPM's digital bank Chase UK has revealed that a credit card is now in the works as the company extends the product array for its retail base, which has now hit the hit the million-customer mark. The unit is also reportedly hiring in Germany, having long signalled that the United Kingdom is a testing ground for a multiple-market rollout over time.
Latin America 's powerhouse economy, Brazil, has stirred up increasing excitement on the back of developments such as runaway payments success Pix and a burgeoning fintech ecosystem. Prepaid cards are particularly useful for the unbanked, but the industry will be reviewing its business models in light of the announcement from Brasilia that interchange on prepaid cards will now be capped at 0.7 percent. Debit cards swipe fees too, are being limited, in their case to half a percent for each transaction.
"Fintechs around the world have been able to use prepaid instruments creatively to mimic traditional bank accounts and in some cases have benefitted from higher interchange", commented David Hickey of Argus Advisory Research. "It is inevitable that there will be a push to close these gaps as fintech becomes more mainstream. While Nubank and PagSeguro may suffer revenue losses due to the new cap, they are by now well-established in the market and sufficiently diversified to weather this storm". According to Argus Advisory Research's recent market report on Brazil, Nubank is a top five credit card issuer and PagSeguro a top five acquirer in the country.
Other stories of interest this week...
Global: Revenues soar by two-thirds at Stripe's EMEA/APAC unit
Europe: Worldline to acquire 40 percent of Dutch Online Payment Platform
Spain: Sabadell in talks with Worldline, Nexi and Fiserv for c€400m payments deal
UK: Eight-year-old Paym mobile payments service to close
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The Weekly News Digest from Argus Advisory Research highlights significant developments in payment cards, digital payments, acquiring, processing, retail banking and consumer credit. Our writers and researchers frame these items in contexts such as historical, sectoral and regional trends, adding a layer of value often missing from the rolling news cycle.
About Argus Advisory Research The market-leading online, interactive database and data dashboards covering the global cards and payments industry in detail, plus a range of data-packed country and regional reports. Leveraging financial cards data going back to 2010 – and forecasts up to 2025 – our unique datasets cover countries around the world and feature more than 250 metrics per market.