The buy now pay later approach could boost this Fintech ETF

It’s no secret that inflation has put a dent in consumers’ bank accounts in 2022, but financial technology (fintech) companies are trying to ease the burden by finding ways to offer cost-effective financial transactions. One of them is the “buy now, pay later” method, which allows holiday shoppers to maximize their purchasing power.

“Americans are relying on buy now, pay later (BNPL) methods this holiday season due to inflation concerns,” Mayuranki De said in a Global X blog post. “Leading BNPL platform Afterpay announced that online and in-person transactions increased by 120% compared to the pre-holiday period.”

“Square and Afterpay’s Festive Forecast Report anticipated this trend as one in six Americans reported plans to use BNPL during the gift-giving season,” De added. “Overall, BNPL usage increased by an estimated 68% in the week through November 27 compared to the previous week. BNPL revenue increased by 72% during the same period.”

Gain broad Fintech exposure

Instead of picking single stocks for fintech exposure, there’s an easier way. For broad exposure in the growing sector, consider Global X FinTech ETF (FINX) as an alternative.

FINX seeks to provide investment results equivalent to the Indxx Global Fintech Thematic Index. The index is designed to provide exposure to listed companies in developed markets that offer financial technology products and services, including companies involved in mobile payments, peer-to-peer (P2P) and marketplace lending, financial analysis software and alternative currencies, as defined by the index provider.

The fund gives investors exposure to the following:

• High Growth Potential: FINX provides investors with access to high growth potential through companies that use technological innovations to disrupt and improve the delivery of financial services.
• An unrestricted approach: The fund’s composition transcends classic sector, industry and geographic classifications by tracking an emerging theme.
• ETF efficiency: In a single trade, FINX offers access to dozens of companies with high exposure to the fintech theme.

E-commerce exposure

With fintech exposure helping to drive online sales, consider getting e-commerce exposure too Global X E-commerce ETF (EBIZ). EBIZ seeks to invest in companies that are positioned to benefit from the increased use of e-commerce as a distribution model, including companies whose primary business is operating e-commerce platforms, providing e-commerce software and services and/or selling goods and online services.

“Despite persistent inflation and a return to retail headwinds, US holiday sales got off to a strong start this year, especially online,” De said. “Compared to 2021, Thanksgiving, Black Friday and Cyber ​​Monday sales increased. US consumers spent a record $5.3 billion online on Thanksgiving Day, a 3% increase over 2021.

For more news, information and analysis, visit Thematic investment channel.