PayPal CEO Dan Schulman told CNBC’s Jim Cramer on Tuesday that use of the company’s buy now, pay later option surged on Black Friday.
In an interview on “Mad Money,” Schulman said PayPal’s installment payment service is “one of the stars, actually, of the holiday season for us.”
“During Black Friday, our volume on buy now, pay later was up almost 400% year over year. We did some 750,000 transactions alone in one day on Black Friday,” Schulman said, referring to the day after Thanksgiving that’s a key part of the holiday shopping season.
The activity on Black Friday continues a trend PayPal observed throughout November, which is the first time the company recorded more than $1 billion of process volume through its buy now, pay later option in a single month, Schulman said.
“We did over 1 million first-time users for the first time ever in a month,” he added, putting its overall usage “well over 10 million consumers.”
Buy now, pay later has become increasingly popular among consumers during the coronavirus pandemic, and financial technology companies are racing to grab a piece of the red-hot market. Leading players in the space include Affirm, which in August scored a blockbuster partnership with Amazon, and the Swedish start-up Klarna.
PayPal launched an installment payment option called “Pay in 4” in the U.S. in late 2020, allowing people to pay for certain purchases over four interest-free payments. In September, PayPal also announced plans to acquire Japanese firm Paidy in a $2.7 billion deal.
PayPal is not alone in seeing a jump in buy now, pay later activity this holiday season. According to data from Salesforce, the use of the payment method globally during Cyber Week — from Nov. 23 to Monday — jumped 29% year over year. On Black Friday, in particular, Salesforce said 7% of global orders and 4% of those in the U.S. used a short-term, installment payment option.
— CNBC’s Lauren Thomas contributed to this report.
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