Square plans to acquire Australian company Afterpay, which offers a “buy now, pay later” service that lets you pay for purchases in installments interest-free, for $29 billion in stock, the two companies announced Sunday.
It’s the latest big move for Square, which has also announced a Bitcoin business unit and that; it bought a majority stake in the Tidal streaming service this year.
“Buy now, pay later” services like those offered by Afterpay, Affirm, and Klarna have become increasingly prevalent across the web. And Square may not be the only payments giant jumping into the ring, as Apple is reportedly working on a similar service of its own that’s internally called “Apple Pay Later.”
Afterpay already serves more than 16 million customers and nearly 100,000 merchants across the world, according to a press release.
Square and Afterpay expect the transaction to close in the first quarter of 2022.
Once the acquisition is completed, Square will appoint an Afterpay director to join Square’s board.
“Square and Afterpay have a shared purpose. We built our business to make the financial system more fair; accessible, and inclusive, and Afterpay has built a trusted brand aligned with those principles;” Square co-founder and CEO Jack Dorsey said in a statement.
“Together, we can better connect our Cash App and Seller ecosystems to deliver even more compelling products and services for merchants and consumers; putting the power back in their hands.”