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The profit margin per "Revenue" dollar is so small for a payment processor it always seemed like a strange metric to value a payments company on for me, as they are essentially just a middle man for this "Revenue" taking it from the customer and giving it to the merchant. Afterpay does typically have higher merchant fees than a regular CC gateway tho

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Afterpay aren't really a payments processor in the typical sense though, their business model is nothing short of genius tbh. They've set up a non-traditional 2-sided market connecting consumers + merchants, allow consumers to pay the MERCHANTS back over 4 installments and collect a 5% fee on the way through as well as any late fees (remember they're not taking on the risk here either)

This feels similar to the United States credit card market where there’s a 3% fee paid for by the merchant and thus a lot of opportunities to “reward” customers, and an incentive to keep things status quo.

Afterpay bears the credit risk, not the merchants. Search for the keyword "net transaction loss": https://afterpay-corporate.yourcreative.com.au/wp-content/up...

They take like 5% of the money. That's pretty dang significant.

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