5 Questions
What has been a major driver of growth for the BNPL sector?
Changes in consumer preferences
How many BNPL providers are active in the European and North American markets?
Over 50
What is Alma's main priority?
To keep fighting inflation
What are the three key points that Alma focuses on when negotiating terms with merchants?
Reducing the cost of risk, maintaining a high performance on the market, and adapting pricing
What has been the impact of the policy rate raise on the financial markets?
Higher financing costs leading to an increase in inflation
Study Notes
- The Buy Now, Pay Later (BNPL) sector has seen strong growth in recent years, driven by changes in consumer preferences and a COVID-boosted shift in shopping patterns.
- The number of BNPL providers has proliferated, with over 50 in the European and North American markets today.
- The policy rate raise has had a negative impact on the financial markets, with higher financing costs leading to an increase in inflation.
- Alma is one of the few BNPL providers that has always been responsible and has always sought to protect the final consumers from over-indebtedness.
- The number 1 priority for Alma is to keep fighting inflation and to adapt to the changing financial markets conditions.
- Alma is adapting its acceptance policy in order to reduce its Cost of risk.
- This includes decreasing acceptance at macro level in order to reach an acceptable margin AND to ensure we are at least breakeven on every single merchant we work with.
- This is an ongoing work led by the risk and finance team.
- There are three key points you need to focus on when negotiating terms with your merchants: reducing the cost of risk, maintaining a high performance on the market, and adapting pricing to make sure Alma remains sustainable.
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