Buy Now Pay Later (BNPL) player Afterpay is shutting down its Westpac-backed banking app less than a year after its launch as its new US owner prepares to introduce its own financial app in Australia.
Afterpay said on Friday it would stop accepting new customers on its youth-focused Money by Afterpay app, which provides savings accounts and transactions, using Westpac’s technology and banking license. The app will be shut down in October, and Westpac said it would help customers move their funds to other banks.
Afterpay said it would focus on Cash App, which is owned by its parent company.Credit:Louis Douvis
The decision to shut down the app follows the acquisition of Afterpay by US fintech giant Block, led by Twitter co-founder Jack Dorsey, which announced a record $39 billion deal to buy Afterpay just over a year ago.
Block has previously said it wants to introduce its popular Cash App, which provides consumers with services including payments, investments and cryptocurrency trading, in Australia. Cash App is a core part of Block’s business, alongside its Square merchant payments business, and sees Australia as a priority market due to Afterpay’s strong local presence.
Meanwhile, Westpac had been working with Afterpay as part of a push toward what’s known as “banking as a service” (BaaS), where banks lease their infrastructure and banking license to other companies, such as retailers or tech firms.
Charging
Block has not provided details on when it will launch the Cash app in Australia, but Money by Afterpay frontman Lee Hatton said this was the reason he was ending the partnership with Westpac.
“Our decision to move forward in this new direction is due to our exciting next chapter with Block, particularly as we think about the Cash App opportunities here in Australia, and we wish the Westpac team and their growing list of BaaS customers continued success. Hatton said. .
Afterpay offers short-term interest-free loans to buyers as an alternative to credit cards, and its partnership with Westpac was an attempt to diversify and grow by selling a broader range of financial products.
Leave a Reply