Soon you will be able to make payments after payment on the Cash app

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It might be a mouthful, but it’s actually legitimate financial news: Square, which owns Cash App, is buying Afterpay, so soon you’ll be able to pay for your Afterpay purchases through Cash App.

This is a great development for people on both sides of the cash register (less). Square announced on Sunday that it plans to acquire the purchase now, later pay the Afterpay startup for $ 29 billion. Square is famous for its white card readers and payment terminals, which have become ubiquitous in coffee shops and farmers’ markets across the United States.

Now he hopes to expand Afterpay’s reach in the same way.

Once the deal is done early next year, Square hopes to “integrate Afterpay into its existing Seller and Cash App business units” and “enable even the smallest of merchants to offer BNPL. [buy now, pay later] at checkout, “according to a press release. Meanwhile, Afterpay customers will be able to” manage their installment payments directly in the Cash App. “

The integration is likely to excite smaller vendors who will be able to attract more customers by offering payment plans for purchases of all sizes. But it’s also important for young buyers, who make up the majority of Afterpay’s 16 million users.

Afterpay, Klarna, and Affirm are huge among Millennials and Gen Z customers who are wary of credit cards. Brands have become so popular that there are memes and Facebook groups dedicated to them. They are accepted by trendy retailers like Anthropologie, Calvin Klein, Glossier, StubHub, Warby Parker and more.

At the same time, young consumers also love Cash App. It is not uncommon for them to use the mobile payment service as a bank account. They can get paid, invest, pay bills, send money to friends (Venmo style) and even receive their tax refunds on the app.

In that sense, Square’s proposal to let Afterpay customers make payments in the Cash App is a natural pairing – and one that takes a step out of the refund process. Square also aims to help Cash App customers find Buy Now, Pay Later offers right in the app.

“The addition of Afterpay to Cash App will strengthen our growing consumer networks around the world while supporting consumers with flexible and responsible payment options,” said Brian Grassadonia, Head of Cash App Business at Square, in the press release.

Chance Robinson, president of Strong Point Financial, says the acquisition is a signal that Square is hoping to become a bank one day. But while many retailers will appreciate the flexibility that acquisition brings, it can also be risky.

“With this freedom for consumers comes awareness and responsibility, as it leaves that control over personal finances in the hands of that person,” adds Robinson.

Afterpay doesn’t charge interest, only late fees for missed payments, but some competitors’ funding options boil down to fixed rate loans. Consumers may not understand exactly what they are getting into. It’s also possible that making a habit of buying items you can’t afford could lead to reckless spending down the road.

Robinson says buyers and the companies involved in the acquisition need to be careful. Think twice before splitting a $ 5 coffee purchase into installments just because you can.

“Square will need to play a leading role in educating and limiting its users to avoid overspending and overindebtedness, especially for people who postpone paying their daily dose of caffeine,” he says.

More money :

Inside Cash App Friday, the weekly phenomenon where people ask for money on Twitter (and get it)

Should you use Venmo, Zelle or Cash App? Everything you need to know about the most popular mobile payment apps

Are you rude on Venmo? Here’s how to use payment apps without being a jerk

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