Business

Block CFO says customers repay almost all buy now, pay later loans

Nearly all of Afterpay‘s customers repaid their installments in 2021, Block CFO Amrita Ahuja told CNBC on Thursday when questioned about the Cash App parent’s acquisition of the buy-now, pay-later service.

“What I will say about losses, is that the team has actually been incredibly deliberate in managing consumer losses as an input rather than an output to growth,” Ahuja said in an interview on “Mad Money.” 

She later added, “98% of consumer installments were repaid by the end of the year, which is the same percentage we saw in the first half. This is a key focus area for us.”

When Cramer questioned Ahuja about whether the phrase “buy now, pay never” rings true, she said that consumer losses for Afterpay were up 8 basis points in the second half of 2021 compared to the first half of the year. A basis point equals 0.01%.

Ahuja’s comments come after the company formerly known as Square reported a better-than-expected fourth quarter Feb. 24. Block shares closed down 8.08% this Thursday, well below its 52-week high. 

Block closed its acquisition of Afterpay in January, a deal that came after buy now, pay later services saw their popularity soar during the coronavirus pandemic.

“We know that our sellers are asking for buy now,-pay later. They want access to the tens of millions of millennials and Gen Z consumers who are looking outside of the traditional financial system for credit,” she said

Ahuja also said that Block launched a product integration with Square’s online platform on “day one,” with more to come.

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