What is Afterpay?
Afterpay is a buy now, pay later service founded in Sydney in 2014 by Nick Molnar and Anthony Eisen. It lets shoppers buy items and pay for them in four instalments, usually without interest.
Molnar was selling jewellery online when he met Eisen, an investment banker who lived nearby. They created Afterpay to give younger shoppers a way to spread payments without using a credit card.
Shoppers pay in four fortnightly instalments, and stores pay Afterpay a fee for each sale. If customers pay late, they may be charged late fees.
Global deal
Afterpay expanded to the United States, the United Kingdom and other countries. In 2021, American payments company Square, now Block, agreed to buy Afterpay for about 39 billion dollars, one of the largest takeovers in Australian corporate history.
Buy now, pay later services have been criticised by consumer groups for encouraging people to spend more than they can afford. In 2024, Australia passed laws bringing these services under consumer credit rules, including checks on whether customers can afford repayments.
The service remains popular, especially with younger shoppers buying fashion, beauty and electronics online. Afterpay's rapid growth helped create a whole industry, with competitors such as Zip and Klarna also operating in Australia.
Did You Know?
Nick Molnar became one of Australia's youngest self-made billionaires.