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Britain's Monzo poised to enter 'buy now, pay later' market

© Reuters. FILE PHOTO: A smartphone displays a Monzo logo in this illustration taken January 6, 2020. REUTERS/Dado Ruvic/Illustration/File Photo

LONDON (Reuters) – Monzo is poised to enter the “buy now, pay later” market, according to a source familiar with the plan, as the British digital bank looks to boost its profitability.

The bank is finalising plans for a service, which will include affordability assessments, the source said.

Retailers and financial technology firms have been crowding into the “buy now, pay later” market, as consumers embrace buying in installments when shopping online.

The boom has boosted providers including Klarna, Affirm, Afterpay and Paypal, but has led to greater scrutiny by regulators concerned consumers do not take on more debt than they can handle.

The Evening Standard first reported on Monzo’s plan. Its rival Revolut is also planning a similar move, the newspaper earlier reported.

Monzo has attracted five million customers since launching in 2015, but has struggled to turn its popularity into profits, with its annual losses widening to 130 million pounds in the year to February.

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