PayPal has struck a deal to buy Japanese buy now, pay later firm Paidy for around $2.7 billion, mainly in cash.
The deal strengthens PayPal's position in the third largest e-commerce market in the world and also boosts its credentials in the fast-growing BNPL sector.
Paidy allows Japanese shoppers to make purchases online, and then pay for them each month in a consolidated bill at a convenience store or via bank transfer. The company uses proprietary technology to score creditworthiness, underwrite transactions and guarantee payment to merchants.
Launched in 2014, the firm now claims more than six million registered users. In April, it raised $120 million in a Series D funding round.
Peter Kenevan, VP, head of Japan, PayPal, says: "Combining Paidy's brand, capabilities and talented team with PayPal's expertise, resources and global scale will create a strong foundation to accelerate our momentum in this strategically important market."
The acquisition is slated to close in the fourth quarter, after which Paidy will continue to operate its existing business and maintain its brand.