Afterpay Competitors In A Nutshell

Afterpay is an Australian fintech company operating in Australia, Canada, the United Kingdom, New Zealand, and the United States.  Founded in 2014 by Nick Molnar and Anthony Eisen, the company enjoyed a first-mover advantage in the buy-now-pay-later (BNPL) space. Less than seven years later, the company reached 13.1 million active customers with gross sales amounting to $10.1 billion. Despite its success, some suggest the company has lost its edge in the buy-now-pay-later space with the emergence of several high-profile competitors exerting their influence and giving merchants more choice.


Zip is another Australian fintech company founded approximately one year before Afterpay. The company offers the interest-free Zip Pay digital wallet with BNPL functionality and also the free budget planner and personal finance app Pocketbook. For those desiring a line of credit for larger purchases, Zip Money is also available.

Zip is perhaps the largest Afterpay competitor in the Australian and New Zealand markets, processing $893.5 million in transaction volume during Q4 FY21 alone. However, Zip also has a significant presence in North America after acquiring QuadPay for $400 million in June 2020.


PayPal makes money primarily by processing customer transactions on the Payments Platform and from other value-added services. Thus, the revenues streams are divided into transaction revenues based on the volume of activity or total payments volume. And value-added services, such as interest and fees earned on loans and interest receivable. As of 2020 PayPal generated over $21.5 billion in net revenues with a 25% operating margin

In March 2021, PayPal announced plans to launch its deferred payment service for Australian merchants. The service, dubbed PayPal Pay in 4, was launched in the US, UK, and France the previous year in response to high consumer demand.

The payment service appears in the PayPal wallet at checkout and eCommerce businesses can also advertise the option using a dedicated button on their website. When it was launched in Australia, PayPal Pay in 4 was immediately available to the more than 9 million PayPal members.

Read Also: How Does PayPal Make Money


Apple is a product-based company fueled by platform business models (like Apple Store), in which sales still primarily come from the iPhone. However, the company has also transitioned toward a service company (with Apple Store, iTunes now called Apple Music) and as a wearable product company, which is the fastest-growing segment.

Bloomberg reported in July 2021 that Apple was working on a service to let shoppers pay for purchases in installments. The loans would be underwritten by Goldman Sachs Group Inc., a partner of the company since the Apple credit card was launched in 2019.

Apple represents a significant source of competition in the fertile North American market. The tech giant also recently announced it would partner with Affirm PayBright to offer a BNPL solution for Apple device purchases in Canada.

The Commonwealth Bank of Australia

The Commonwealth Bank of Australia is a large multinational bank with business interests across Australia, New Zealand, Asia, the US, and the UK.

The bank launched StepPay in August 2021, a BNPL service for purchases over $100. More than 86,000 consumers pre-registered for the service before it was released in Australia. StepPay can be added to the existing CommBank app or digital wallet on smartphones and tablets.


Splitit is a fintech company founded by Israeli entrepreneurs Gil Don and Alon Feit in 2009. The platform was initially created to allow consumers to use existing credit to make BNPL purchases. Splitit relies on transaction fees to make money, with the exact fee depending on how and when the merchant chooses to be paid.  Splitit does not charge consumers for late or missed payments. Nor does it charge interest on purchases. Instead, the company relies on transaction value and mass consumer uptake to make money.

Splitit is a BNPL service where consumers and businesses can leverage their existing Visa and Mastercard credit cards. Unlike competitor services, Splitit is not new financing. This means customers avoid paying interest because they aren’t required to carry new debt.

Splitit reported a 31% increase in year-on-year merchant sales volume in Q3 2021. Approximately 1.8 billion cardholders now have access to the platform with the company having a presence in over 30 countries.

Key takeaways:

  • Afterpay is an Australian fintech company founded in 2014 by Nick Molnar and Anthony Eisen. The company enjoyed a first-mover advantage in the BNPL space but is now subject to increased competition in the Australian and North American markets.
  • Zip and the Commonwealth Bank of Australia are the most significant competitors in the Australian market, with the latter having access to a large user base. 
  • Tech behemoths Apple and PayPal have also entered the industry, with Apple announcing plans to offer a BNPL solution in the United States and Canada in partnership with Goldman Sachs and Affirm respectively.

Read Next: Afterpay Business Model

Read Also: How Does PayPal Make Money

Connected Fintech Business Models

Fintech Business Models


Venmo Business Model


Stripe Business Model


Coinbase Business Model


How Does Zelle Make Money


Klarna Business Model


Affirm Business Model

Started as a pay-later solution integrated to merchants’ checkouts, Affirm makes money from merchants’ fees as consumers pick up the pay-later solution. Affirm also makes money through interests earned from the consumer loans, when those are repurchased from the originating bank. In 2020 Affirm made 50% of its revenues from merchants’ fees, about 37% from interests, and the remaining from virtual cards and servicing fees.

Afterpay Business Model 

Afterpay is a FinTech company providing as a core service the “buy now pay later” solution. When a consumer purchases a product, Afterpay pays the seller and asks the consumer to pay 25%. The remaining 75% is paid in three, fortnightly installments that are also interest-free. Afterpay, in turn, makes money via merchant and late fees.

Quadpay Business Model

Quadpay was an American fintech company founded by Adam Ezra and Brad Lindenberg in 2017. Ezra and Lindenberg witnessed the rising popularity of buy-now-pay-later service Afterpay in Australia and similar service Klarna in Europe. Quadpay collects a range of fees from both the merchant and the consumer via merchandise fees, convenience fees, late payment, and interchange fees.

Revolut Business Model

Revolut is an English fintech company offering banking and investment services to consumers. Founded in 2015 by Nikolay Storonsky and Vlad Yatsenko, the company initially produced a low-rate travel card. Storonsky in particular was an avid traveler who became tired of spending hundreds of pounds on currency exchange and foreign transaction fees. The Revolut app and core banking account are free to use. Instead, money is made through a combination of subscription fees, transaction fees, perks, and ancillary services.

Main Free Guides:

Scroll to Top