Payroll, payment rails fair game for BNPL players

Consumer demand for buy now, pay later options is on the rise at physical and virtual points of sale, and BNPL providers are finding new ways to leverage existing infrastructures. Among new BNPL entrants are Apple Pay Later and a payroll solution powered by partners Atomic and Bond that enables consumers to pay BNPL installments directly from their paychecks.

Apple Pay Later

Apple unveiled its BNPL solution at its WWDC conference, held in New York on June 6, 2022, as part of ongoing efforts to own the customer experience. The company noted it will not take a cut of the transactions. News outlets openly speculated on Apple Pay Later's impact on leading BNPL brands and the market at large.

Retail Dive reporter Jonathan Berr, citing recent analysis, estimated Apple Pay's user base will grow from 45.,4 million to 56.6 million by 2026, and suggested Apple Pay Later will further accelerate that growth. "Apple Pay Later, available only to U.S. consumers, will be accepted online or for in-app purchases via the Mastercard network," he wrote in a June 7 post titled, "Apple joins buy now, pay later boom."

In July 2021, when Apple initially disclosed its plans to launch a BNPL service, Bloomberg journalists Mark Gurman and Sridhar Natarajan observed an impact on Klarna and PayPal stock. "Affirm fell 10% Tuesday on the news, while PayPal recovered losses to end down just 0.6%. Afterpay slumped 9.6% in Sydney on Wednesday morning," they wrote in "Apple, Goldman Plan 'Buy Now, Pay Later' Service to Rival Affirm," published July 13, 2021.

Repay it forward

On June 9, 2022, partnering companies Atomic and Bond unveiled Repay, a solution that enables consumers to make recurring payments in small installments directly from their paychecks. The solution leverages capabilities of Atomic, a payroll connectivity provider and Bond Financial Technologies, an embedded finance company, the partners stated.

Jordan Wright, co-founder and CEO of Atomic, explained that Repay gives consumers more control of their personal finances by enabling them to tailor products to their personal profiles and payroll data.

For financially vulnerable consumers, it works as a fractional repayment plan that gives them a lifeline to pay for things they need without having to risk falling behind on bills and incurring an avoidable fee, Wright said. "Meanwhile, our customers now have a novel option to build goodwill with consumers by offering better interest rates while minimizing default and late repayment risks."

Wright further noted that Atomic uses Bond's embedded finance infrastructure to create and open user bank accounts while managing KYC, transaction monitoring and compliance independently—without a sponsor bank. Repay connects payroll information with a demand deposit account for each user, while calculating the fractional deposits, managing payment according to due date, and keeping Repay users apprised of all automatic installment payments, he added.

Roy Ng, CEO and co-founder of Bond, endorsed the partners' latest innovation. "Atomic and Bond together bring a seamless, integrated solution to a major problem that often leaves employees confused and employers concerned about their workers' financial well-being," he said in a statement.

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