Afterpay announces Tencent as substantial shareholder

Chinese tech giant Tencent has bought a 5% stake, worth around A$390 million, in Australian buy now, pay later specialist Afterpay.

Anthony Eisen and Nick Molnar, Co-founders of Afterpay comment: "We feel very privileged to welcome Tencent as a substantial shareholder in our business. Being able to attract a strategic investor of this calibre is extremely rewarding and is a testament to our team and the strength of our differentiated business model.”

"The investment provides us with the opportunity to learn from one of the world's most successful digital platform businesses. To be able to tap into Tencent's vast experience and network is valuable, as is the potential to collaborate in areas such as technology, geographic expansion and future payment options on the long-term."

James Mitchell, Chief Strategy Officer at Tencent, says: “Inside China we operate the leading digital payment service and a rapidly growing FinTech platform, and outside China we have actively invested in pioneering FinTech companies, providing us with unique insights into emerging FinTech services.”

“Afterpay's approach stands out to us not just for its attractive business model characteristics, but also because its service aligns so well with consumer trends we see developing globally in terms of its customer centric, interest free approach as well as its integrated retail presence and ability to add significant value for its merchant base. We look forward to a deep and long-term business partnership.”

eBay deal

Afterpay is now available on eBay Australia in what the PayTech venture has labelled its largest online deal in the country.

The partnership will allow it to provide its buy now, pay later service to the platform's 40,000 small and medium businesses and 11 million monthly users.

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"Especially today, Aussies are relying on eBay to get what they need, in one place at great value," says eBay Australia MD Tim MacKinnon. "Australian businesses need all the support they can get right now and offering Afterpay could be what makes or breaks a sale."

eBay says that it will not be passing the costs of using Afterpay onto its sellers; instead the venture will cover the transaction cost itself.