Block attacks credit card with BNPL
Three years after the acquisition of AfterPay, Block (ex-Square) replicates the payment several times in the United States. Its new solution, integrated with Cash Appoffers an alternative to traditional credit cards, in line with the consumption habits of generation Z.
FACTS
Block, after the acquisition of AfterPay, launches its split payment solution within its Cash App platform. This allows users to divide their purchases into four payments over six weeks, free of charge (excluding reimbursement incidents).
This solution aims to compete with credit cards, in particular by attracting young customers who are eager to control their finances, often reluctant to face the debts and high interest charges associated with traditional cards.
Cash App also offers a reward program, a feature that particularly seduces American consumers and complements the split payment offer.
The product primarily targets generation Z, which is less attracted to credit cards and the debts they can generate. It also meets the needs of those who do not have access to traditional credit due to insufficient or uncertain financial history.
This offer was initially launched with a selection of customers in 20 states, with the aim of extending the offer according to user returns and measuring product acceptance.
ISSUES
A more transparent alternative to credit cards : The BNPL model allows for the splitting of interest-free payments, a more flexible and transparent solution compared to traditional credit cards, which are often considered costly due to interest and associated costs.
Strategic Positioning for Block By combining its two product lines, Block hopes to increase the volume of activity on Cash App and diversify its revenue sources. This initiative could also allow it to differentiate itself more from its competitors in the payments sector.
Changing regulations: While regulatory flexibility in the United States favours the expansion of the LNP, in 2026 the European Union provided a stricter framework to limit the risk of excessive debt. This divergence could influence the strategy of the players in the sector, forcing them to adapt their approach to the markets.
Reactions of traditional banks Although other financial institutions have launched similar products, BNPL offers coupled with credit cards, such as those offered by ScotiaBank or BMO, have not yet been very successful. Traditional banks, which derive significant revenues from their credit cards, may be reluctant to promote a solution that could reduce these profits.
PERSPECTIVE
- FinTechs pressure on banks: Large banks, like JPMorgan Chase and Citi, are embarking on the BNPL to compete with FinTechs, a trend that joins Block's initiative with Cash App, aiming to seduce a young customer and showered with credit cards.
- Adoption of the LNP by all income categories: The BNPL is adopted not only by low incomes, but also by those with higher incomes, which reinforces the relevance of Block's offer, accessible to all.
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