Afterpay, Westpac link up for Australia savings accounts

Melbourne

AUSTRALIAN buy-now-pay-later firm Afterpay Ltd will team up with Westpac Banking Corp to offer savings accounts, the two companies said on Tuesday, signalling a shift by the alternative credit firm into mainstream banking.

The accounts will be available to Afterpay's three million-plus customers in Australia from next year through Westpac's digital banking platform, and will help give the firm greater insight into its customers' financial habits, it said.

The announcement sent Afterpay's shares up 6 per cent and past the A$100 mark for the first time, highlighting the staggering rise for a stock that was at just A$8 in March.

For Westpac, which last month reached a record A$1.3 billion (S$1.2 billion) settlement with Australia's financial crime agency for allowing illicit payments, the venture marks a push into fintech and will help it target younger customers.

Afterpay will be Westpac's first digital banking platform customer, and the Melbourne-based firm will also offer budgeting tools and other services over time. The partnership goes live in the second quarter of 2021.

Afterpay and its buy-now-pay-later peers, who let users buy goods and pay over interest-free instalments, have been heralded as disruptors of traditional credit and have surged in popularity as the coronavirus crisis accelerates the shift online. REUTERS