Afterpay closes its Money app
Following being taken over by US payments giant Block last year, buy now pay later group, Afterpay, is shutting down its Money app and thinking about opportunities for Cash App, Block's app, in Australia.
Money by Afterpay accounts will be closed on 10 October and has stopped taking on new customers from today.
“Our decision to move in this new direction is due to our exciting next chapter with Block, particularly as we think about Cash App opportunities here in Australia,” says Lee Hatton, Money by Afterpay lead.
Currently available in the United States and the United Kingdom, the Cash App has 47 million active users.
Block CEO Jack Dorsey has said that the purchase of Afterpay has led to design changes in the Cash App and he has also spoken about turning it into a “super app” to complement the group’s merchant payment business, Square.
Earlier this month, he said: “In terms of retention and also new customer acquisition, it really has to do with like how much utility we’re offering, that we’re not just focused on one thing such as peer-to-peer transactions or investing or Bitcoin or lending, but it is a place, one place you can do all those things. And we see peers in other industries and other spaces and other countries that have done that very well, which is sometimes referenced as super apps or banks.
“And we believe that over the long term, that is the right strategy, and that is both for the Cash App ecosystem and also the Square ecosystem. And more importantly, the fact that we have both of those in one company, we believe, is our superpower.”
Money by Afterpay became Westpac’s first partner for its “bank-as-a-service” (BaaS) offering when it launched in October 2020.
Afterpay managed the look and feel of the app’s customer experience, but Westpac – as the licensed authorised deposit-taking institution – held the direct banking relationship with end customers.
The app provided access to a daily transaction account, savings accounts and a minty fresh Mastercard Debit card. Users also got a personalised, data-driven story of their money flow on a daily and weekly basis.
"We are really proud of the work we’ve done with the Westpac team to model a completely different approach in the Australian market that was firmly focused on the needs of our customers,” says Hatton.
“We wish the Westpac team and its growing list of BaaS customers continued success.”
Westpac says it will support Money by Afterpay customers to transfer funds to accounts of their choice. Competitive offers will be available to these account holders if they wish to stay with Westpac.
“A change of ownership naturally sees partnerships evolve and we have been working co-operatively with Afterpay on this transition to ensure a smooth customer pathway,” says Damien MacRae, CEO of Westpac BaaS.
“Westpac is extremely proud of being first to market in Australia with our digital BaaS business, and the work we’ve done with the Money by Afterpay team. We have learned a great deal through this foundational partnership, and we wish them well for the next iteration of their business. Westpac is well placed to continue to leverage the capability from our partnership with cloud-native platform 10x."