- Investors sell out of growth stocks like technology amid interest rate hikes in near future.
- Regulatory crackdowns are nearing as increasing numbers of BNPL users rack up unaffordable debts.
- BNPL favourites continue to report strong growth in business terms, but shares are down so far in 2022.
The US and Australian markets have had a turbulent start to 2022 with investors now facing interest rate rises by both the Feds and RBA to address rising inflation.
As a result, tech stocks have faced sharp sell-offs this year as investors sell out of risky assets in favour of stocks tied to economic recovery.
Buy now, pay later providers have more than just interest rate hikes to worry about this year as countries around the world move closer to a regulatory crackdown on the sector.
The UK Treasury unveiled policy options to regulate the BNPL sector in October last year, while the Consumer Financial Protection Bureau said it is working with Australia, the UK, Germany and Sweden on protecting customers from rapidly acquiring unaffordable debts.
Year to date, Zip Co, Afterpay and Sezzle shares are down more than 20%, with Afterpay closing its last day of trade on the ASX down 20.7% YTD.
You can read the full story at Grafa
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