The Afterpay Ltd (ASX: APT) share price finished lower on Wednesday, ending the day at $126.23, a 0.38% dip on its previous close.
Shares in the buy now, pay later (BNPL) company were down after it announced the launch of its new "money and lifestyle app" called Money by Afterpay.
Let's take a closer look.
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What did Afterpay announce?
Afterpay advised that Money by Afterpay will also launch with a "world-first feature" called "Afterpay Retro".
This feature will allow customers to "retrospectively create a pay in 4 from any eligible Money debit transaction".
In addition to the add-in, Money by Afterpay users will also have access to the feature "at no cost" and enjoy integration with BNPL, a daily transaction account – with a debit card – and "up to 15 savings accounts".
Back to the "Retro" feature – it can be used by customers for "up to $200" of their Afterpay "available to spend amount".
It appears to be taking the BNPL model away from retail and applying it in other settings, such as hospitality or gift sharing, for instance.
In fact, the feature operates much like a typical Afterpay BNPL purchase in that if customers chose Retro to make payments, they will be "spotted" 100% of the amount by Afterpay.
Customers then repay the credited money back to Afterpay, at no extra cost, in a series of four equal payments. That's the same as Afterpay's BNPL model.
So, for example, if you go out for dinner, spend $200 and "Retro it" — as the company calls it – Afterpay will cover the amount and you will pay off the $200 in four $50 instalments.
It will also follow Afterpay's "no payment upfront format" where the first payment is due two weeks after the purchase date.
Importantly, the use of the Retro feature is only open for "purchases available with the Money debit card", among other stipulations.
Speaking on the announcement, Afterpay's executive vice president of the new platform Lee Hatton said:
As we continue building out the Money experience, we're creating a platform for customers to change the way they think about their money. The integration of BNPL and now Retro will give customers a one-stop app for their money management, allowing them to be more in control of their money than ever before.
Afterpay share price snapshot
The Afterpay share price hasn't been up to much since retail payments giant Square Inc announced it was acquiring the BNPL player last month.
Since then, Afterpay shares have shot up but are still off their all-time highs.
Nonetheless, Afterpay shareholders have enjoyed a return of 64% over the past year. This is well ahead of the S&P/ASX 200 Index (ASX: XJO)'s gain of around 25% in the same period.
