Square to buy Afterpay, which offers “buy now, pay later” for $29 billion in stock

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Square plans to acquire Australia’s Afterpay, which offers a “buy now, pay later” service that lets you pay for purchases in interest-free installments, for $29 billion in equity, the two companies announced Sunday. It’s the latest big move for Square, which also announced its Bitcoin business unit and bought a majority stake in streaming service Tidal this year.

“Buy now, pay later” services such as those offered by Afterpay, Affirm and Klarna are becoming increasingly popular across the web. And Square may not be the only payments giant jumping into the ring, as Apple is reported to be working on a similar service of its own called internally “Apple Pay Later”.

The transaction is expected to close in the first quarter of 2022

Afterpay already serves more than 16 million customers and nearly 100,000 merchants worldwide, according to a press release. Square and Afterpay expect to close the transaction in the first quarter of 2022. Once the acquisition is complete, Square will appoint a manager for Afterpay to join Square’s board of directors.

Square and Afterpay have a common purpose. “We have built our business to make the financial system more fair, accessible, and inclusive, and Afterpay has built a trusted brand that aligns with these principles,” Jack Dorsey, co-founder and CEO of Square, said in a statement. “Together, we can better connect the Cash app and the vendor ecosystem to deliver more compelling products and services to merchants and consumers, putting the power back in their hands.”

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