According to Humm Group Ltd (ASX: HUM), global banks are seeking out deals with buy now, pay later (BNPL) providers. They’re said to be looking for agreements similar to Humm’s new deal with Westpac Banking Corp (ASX: WBC).
Last week, Humm announced it has partnered with Westpac’s subsidiary, Red Bird Ventures Limited. The pair will work together to launch Humm’s Bundll product in New Zealand.
Today, the BNPL provider’s CEO Rebecca James told the Australian Financial Review global banks are approaching Humm to provide similar services.
Humm’s Bundll uses the MasterCard (NYSE: MA) network to let customers tap and pay for BNPL purchases.
Westpac’s New Zealand customers will get “preferential” benefits when using Bundll.
Bundll doesn’t charge interest but it does charge late fees if its customers miss a payment.
James commented on the deal, saying:
[We] are actively in discussions with a number of banks, loyalty programs and financial institutions about similar potential partnerships around the globe.
BNPL the future for ASX big banks?
According to James, Westpac is ahead of the unavoidable bend the banking industry must take to provide BNPL services.
CBA is also one of the first of the ASX’s big banks to jump onto the BNPL bandwagon.
Its StepPay is set to launch in the near future. It will allow customers to pay for purchases worth between $100 and $1000 in 4 instalments.
It’s a step up from zero-interest credit cards that charge a monthly fee. Both CBA and National Australia Bank Ltd (ASX: NAB) launched zero-interest credit cards in September last year.
James was quoted by the AFR:
We are seeing a global trend where consumers want to pay with things in fixed-term instalments and the key consideration is how quickly [banks] can respond to that need before their traditional card businesses suffer from a revenue perspective.