Japanese lender Mitsubishi UFJ Financial Group (MUFG) has acquired a 5% stake in Australian buy- now-pay-later firm Afterpay.
MUFG bought 13.9 million ordinary shares of Afterpay for an undisclosed amount.
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The move comes close on the heels of Chinese multinational conglomerate Tencent acquiring a 5% stake in Afterpay for $252m in May.
Founded in 2015, the Melbourne-based fintech offers interest-free installments on purchases and makes money by charging merchants a commission.
The alternative credit firm charges a A$10 fee from customers who miss their payments and freezes their services until the dues are cleared.
In 2019, the late fees accounted for 18.7% of the company’s income, down from 24% in 2018.
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By GlobalDataFollowing the minority stake acquisition by MUFG, Afterpay’s share price jumped to A$82 ($59).
Afterpay is listed on the Australian Securities Exchange (ASE).
MUFG’s minority stake acquisition in Afterpay is in line with its strategy to invest in the financial technology industry.
The company has kept aside $185m at a CVC fund to invest in Australian fintech startups.
