Japan Buy Now Pay Later Business and Investment Opportunities Databook – 75+ KPIs on BNPL Market Size, End-Use Sectors, Market Share, Product Analysis, Business Model, Demographics - Q2 2024 Update

Japan Buy Now Pay Later Business and Investment Opportunities Databook – 75+ KPIs on BNPL Market Size, End-Use Sectors, Market Share, Product Analysis, Business Model, Demographics - Q2 2024 Update

According to PayNXT360, BNPL payments in the country are expected to grow by 40.9% on an annual basis to reach US$15,046.4 million in 2024.

The medium to long-term growth story of the BNPL industry in the country remains strong. BNPL payment adoption is expected to grow steadily over the forecast period, recording a CAGR of 26.5% during 2024-2029. The BNPL gross merchandise value in the country will increase from US$10,676.2 million in 2023 to reach US$48,737.3 million by 2029.

Key Developments in the BNPL Sector in Japan
The BNPL sector in Japan has seen a rise in product launches and developments, reflecting its growing popularity among consumers, especially younger demographics.

Product Launches and Innovations

Paidy Plus Launch: Paidy, a leading BNPL service in Japan, introduced Paidy Plus, which implements stricter verification procedures. This allows users to make higher-value purchases, such as those at Apple Retail Stores and the Apple Online Store, enhancing its service offerings.
Atone's New Payment Options: Net Protections Co. has introduced two new payment options under its Atone service: ""Next Month Deferred Payment"" and ""Instant Deferred Payment,"" which simplify the registration process for users.
Atkara Service by GMO Payment Service: Atkara, a new deferred payment service, allows users to choose various payment options, including full payment the following month or instalment payments spread over 3 to 36 months.

Strategic Partnerships

Klarna's Expansion: Klarna, the Swedish fintech company, has been actively expanding its presence in Japan. It has formed partnerships with local retailers to offer flexible payment options tailored to Japanese consumers. This move aims to increase Klarna's competitiveness in the Japanese BNPL market, which is rapidly evolving.

Regulatory Changes

Instalment Sales Act: BNPL services in Japan are primarily governed by the Instalment Sales Act, which regulates instalment payments and consumer credit. This act requires transparency in terms of fees and payment schedules, but it does not specifically address BNPL services, leading to potential gaps in consumer protection.
Potential for Stricter Regulations: There have been discussions about implementing stricter screening processes for BNPL providers. This includes the possibility of requiring more comprehensive credit checks and clearer disclosures to consumers about the risks associated with BNPL usage, particularly concerning overspending and accumulating debt.
Consumer Protection Concerns: The increasing popularity of BNPL, especially among younger demographics, has raised alarms about financial literacy and the risk of consumers losing track of their spending. This has prompted calls for regulatory measures to ensure that BNPL services do not exploit vulnerable consumers, particularly minors.
Japan's BNPL sector is currently regulated under the Instalment Sales Act, but there is a movement towards stricter regulations to protect consumers and ensure responsible lending practices due to rapid market growth, especially among younger consumers. This balance fosters innovation and safeguards financial health. The popularity of BNPL in Japan has led to notable product launches and developments, particularly among younger demographics.
The BNPL sector in Japan is rapidly evolving, with new product launches and innovations enhancing service offerings and flexibility. Strategic partnerships, like Klarna's expansion, are increasing competition. However, regulatory frameworks are struggling to keep pace, raising concerns about consumer protection and the need for stricter oversight to address potential risks, especially among younger users.

The BNPL payment industry in Japan has recorded strong growth over the last four quarters, supported by increased e-commerce penetration.

This report provides a detailed data-centric analysis of the Buy Now Pay Later (BNPL) industry, covering market opportunities and risks across a range of retail categories. With over 75 KPIs at the country level, this report provides a comprehensive understanding of BNPL market dynamics, market size and forecast, and market share statistics.

It breaks down market opportunities by type of business model, sales channels (offline and online), and distribution models. In addition, it provides a snapshot of consumer behaviour and retail spending dynamics. KPIs in both value and volume terms help in getting an in-depth understanding of end market dynamics.

PayNXT360’s research methodology is based on industry best practices. Its unbiased analysis leverages a proprietary analytics platform to offer a detailed view of emerging business and investment market opportunities.