PayPal Holdings, Inc. (NASDAQ:PYPL) and alternative asset manager Blue Owl Capital Inc. (NYSE:OWL) announced a two-year agreement on Wednesday under which funds managed by Blue Owl will purchase approximately $7 billion of buy now, pay later (BNPL) receivables originated by PayPal in the U.S.
Under the arrangement, PayPal will continue to manage all customer-facing activities, including underwriting and servicing, for its U.S. Pay in 4 BNPL products.
BNPL has been a strategic component of PayPal’s offerings since 2008, with the company launching its Pay in 4 product in 2020.
The service allows consumers to split eligible purchases into four interest-free payments over six weeks and is widely available wherever PayPal operates, making it one of the most broadly distributed BNPL solutions in the market.
For merchants, BNPL provides flexible payment options that drive higher sales and integrate seamlessly within the PayPal ecosystem, often at lower cost than standalone BNPL providers.
Globally, consumers who choose BNPL spend more than 80% per transaction on average compared with standard branded checkout.
In 2024, PayPal processed over $33 billion in BNPL payment volume worldwide, marking a roughly 21% increase from 2023.
Jamie Miller, Chief Financial & Operating Officer of PayPal, said, “This is another great step forward for PayPal and in line with our balance sheet-light model for credit.”
“PayPal’s scale and deep relationships with its consumers allow it to make informed decisions when extending credit through Pay in 4,” said Ivan Zinn, Head of Alternative Credit at Blue Owl.
The deal is already reflected in PayPal’s third-quarter and full-year 2025 guidance for GAAP and adjusted earnings per share, as well as adjusted transaction margin dollars, announced on July 29, 2025.
Separately, PayPal announced plans to invest $100 million across the Middle East and Africa to spur innovation, back entrepreneurs, and promote inclusive economic growth in one of the fastest-growing digital commerce regions.
The investment will be made through a combination of minority stakes, acquisitions, PayPal Ventures funding, and the deployment of people and technology.
The initiative aims to help local businesses scale, create opportunities for innovators, and expand digital economy access to millions of consumers and communities.
The announcement follows the April launch of PayPal’s first regional hub in Dubai, which was established to provide businesses of all sizes with seamless payments, robust security, and expanded access to global markets.
Price Action: PYPL shares were trading higher by 1.16% to $68.10 premarket at last check Wednesday.
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