If you can’t beat ’em, join ’em – the story of NAB’s belated BNPL offering

Would you look at that! NAB becomes the latest bank to give in to the BNPL tidal wave. If you can’t beat BNPL with outdated high-interest credit cards, why not join the fray? NAB’s tilt at the BNPL market could be called a cynical play by an established bank to gather coveted Gen Z customers before they jump ship to Afterpay or Zip (much like the other big banks’ offerings).

“We think the offering that we’ve designed … is really simple to use, and we know that our customers want that service provided by banks” was the standout quote from Rachel Slade, NAB’s Group Executive. But do customers really want banks to provide this service? The other banks seem to agree… (why wouldn’t they?).

Commbank and ANZ (really) have now launched BNPL forays, each with the intent of using their institutional power to skim their enormous customer bases before they take out an account with pure BNPL players.

They might be onto something – NAB had approximately 8 million Aussie customers in 2021, so you’d figure that getting them into the BNPL ecosystem wouldn’t be that difficult with a bit of clever marketing.

They’re facing a massive challenge, though. Afterpay already had 3.6 million active customers in Australia as of 2021, some of whom would be with NAB already. “Just Afterpay it, mate” is a recent addition to the Australian colloquial lexicon – but “just NAB Buy Now Pay Later it, mate” is unlikely to follow.

It’s not just banks that have capitulated to the rising BNPL tide, though. E-commerce’s biggest fish, PayPal, has also leapt on the craze, launching their own BNPL back in March of last year.

What does this mean? It means that competition in the BNPL sector is heating up, but more broadly, we’re witnessing an industry dominated by debt and high-interest credit cards slowly realise that they’re behind the times.

In the end, that can only be a good thing for consumers.