The payments company disclosed that it was selling loans generated in France, Spain, Germany, the United Kingdom, and Italy to investment firm KKR.
KKR will also purchase future originations of BNPL loans that match the requirements. PayPal will continue to oversee all customer-facing operations for its BNPL product in Europe.
“Buy now, pay later,” said Gabrielle Rabinovitch, acting chief financial officer of PayPal, “has become a major asset to PayPal’s checkout experience, driving engagement, payment volume growth, and repeat use while delivering high-value customers to our merchants.”
She went on to say that the relationship will allow PayPal to expand its BNPL operations in Europe “alongside market demand while preserving free cash flow for other strategic initiatives.”
As indicated last month, recent financial results from PayPal and other firms that provide BNPL services illustrate this necessity.
PayPal said that BNPL volumes climbed by 70% year on year to $6 billion. Block said that its BNPL offering pulled in $5.6 billion in first-quarter volumes, representing an 18% year-over-year increase. Affirm’s year-over-year growth rate was also 18%.
Meanwhile, PayPal executives emphasized that consumers who utilize its BNPL service spend 30% more on branded checkout and that more than 90% of them are already PayPal customers.
