The Zip Co Ltd (ASX: Z1P) share price continues to test the resolve of its shareholders, down 1.31% to $6.77 on Thursday.
Meantime, competition in the buy now, pay later (BNPL) market is ramping up. Here's what's new.
PayPal taps into Japan's BNPL market
According to CNBC, Paypal Holdings Inc (NASDAQ: PYPL) is stepping up its global presence with the acquisition of Japanese BNPL company, Paidy.
PayPal will be forking out US$2.7 billion for the acquisition, which will be paid mostly in cash. The acquisition is expected to close in the fourth quarter of 2021.
According to a statement from PayPal on Tuesday:
The acquisition will expand PayPal's capabilities, distribution and relevance in the domestic payments market in Japan, the third largest ecommerce market in the world, complementing the company's existing cross-border ecommerce business in the country.
PayPal has already made its mark on the Australian BNPL market after announcing it will not charge late payment fees.
By comparison, Zip charges a late fee of $5 for Zip Pay and $15 for Zip Money, billed 21 days after the due date.
PayPal's late payment fees announcement coincided with a 10.9% decline in the Zip share price on 15 July.
What else is dragging the Zip share price down?
The tech-heavy Nasdaq Composite experienced strong selling pressure yesterday and fell 0.57%. This compared to the S&P 500 and Dow Jones Industrial Average which fell 0.13% and 0.2% respectively.
Zip's US peers Affirm Holdings Inc (NASDAQ: AFRM) and Square Inc (NYSE: SQ) fell sharply, down 4.34% and 4.18% respectively.
Market Watch reported that traders sold shares in the tech and resources sectors as "uncertainty grows about the outlook for stocks after a strong second-quarter earnings period".
The article also stated: "Doubts also have emerged about the persistence of supportive monetary policies, credited with fueling record gains for stocks, now considered richly valued."
Zip share price snapshot
The Zip share price has typically found buying support about the mid-$6 level, as evidenced by bounces in May and late July.
The Zip share price is up 21% year-to-date, mostly fueled by the strong gains at the beginning of the year.
