BNPL poses changes, but opens opportunities for banking industry

YCP Solidiance’s Gary Murakami gives his insights on future trends amidst the emergence of FinTech companies.

The Asian Banking & Finance Summit happening in Singapore this September features Gary Murakami, a Partner at YCP Solidiance, who presents a comprehensive analysis of the rapidly growing “buy now, pay later” or BNPL sector in Southeast Asia.

Murakami heads the mergers and acquisitions (M&A) practice at YCP Solidiance, a leading management consulting and M&A advisory firm for multinational corporations seeking growth in Asia.

“YCP Solidiance is a management consulting and M&A advisory firm for multinational corporation to assist their growth in Asia with our footprint of 618 offices globally,” Murakami told Asian Banking & Finance in a recent interview.

“We analyse the competitive landscape and market share of players and predict even the future market share,” added Murakami, as he outlined what his expertise within the financial sector brings to the event.

He pointed out how the banking industry is undergoing significant changes due to the emergence of FinTech companies.

“The banking industry used to have a high barrier of entry not from a regulatory standpoint, but with know-how – an interest such as credit assessment, customers reach through physical branches. But these are no longer banks’ special recipe because of the emergence of FinTech companies,” he said.

In particular, the rapid growth in lending FinTech, especially BNPL services, could revolutionize the sector, he said.

“Such BNPL businesses could be acquired by e-commerce players, or brick and mortar retailers who already have in front of customers and products. So, for such retailers acquiring the MPLs (online marketplace lenders) could mean that they gain banking business know-how and infrastructure and eventually become the next generation banks to threaten the traditional banks,” Murakami said.

He underscored the transformative potential of BNPL M&A opportunities, which could lead to non-bank entities, including e-commerce and retailers, entering the banking sector.

His message to non-bank players is clear: seize the market entry opportunity through M&A in the BNPL space. Meanwhile, banking sector players are urged to adopt a proactive approach to navigate this forthcoming mega trend.

As the banking industry evolves in response to technological advancements and changing customer behaviours, it’s clear that collaboration and adaptation will be critical for success, Murakami said.

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