PayPal Holdings, Inc. (NASDAQ: PYPL) and Blue Owl Capital (NYSE: OWL), a leading alternative asset manager, today announced the execution of a two-year agreement under which funds managed by Blue Owl will purchase approximately $7 billion of buy now, pay later (BNPL) receivables originated by PayPal in the U.S. PayPal will remain responsible for all customer-facing activities, including underwriting and servicing, associated with its U.S. Pay in 4 BNPL products.
Online consumer financing has been a strategic offering of PayPal since 2008 and in 2020 the company launched its Pay in 4 product.
PayPal's BNPL solutions are available nearly everywhere PayPal is accepted in its largest markets, making it one of the most broadly distributed BNPL solutions. Pay in four provides consumers with the choice to break up eligible purchases into four interest-free payments over six weeks.
For merchants, BNPL allows them to offer flexible payment options that drive higher sales, all seamlessly integrated within the PayPal ecosystem with no extra tech work, and often at a lower cost than with standalone BNPL providers. When consumers globally choose BNPL, their average order value is more than 80% higher than a standard branded checkout transaction. In 2024, PayPal processed more than $33 billion of BNPL payment volume globally, up approximately 21% from 2023.
PYPL shares began Wednesday trading up 81 cents, or 1.2%, to $68.12, while those for OWL backed off seven cents to $18.58.
