Square, one of the world's leading payment platforms and owned by Twitter co-founder Jack Dorsey, has announced its successful acquisition of Afterpay for $29 billion. 

Afterpay is an Australian financial technology company that operates in Australia, the United Kingdom, Canada, the United States, and New Zealand. The deal was described as a multibillion recommended court-approved 'Scheme of Arrangement.'

The deal places two of the most admired fintech firms in recent history on course to becoming one. Square and Afterpay have the potential to build one of the most important payments networks in the globe.

After the remaining steps of the big deal are completed, the executives, co-founders, and co-CEOs of Afterpay will join Square to manage the fintech company. 

Buy now, pay later

Afterpay is formally known as a "buy now, pay later" (BNPL) platform. Square plans to integrate Afterpay into its Seller and Cash App platforms after it formally completes its acquisition deal next year. 

Through this planned integration, even small merchants can offer BPNL to customers at checkout and would allow Afterpay users to pay in installments directly from Cash App. 

Afterpay has been a fixture in a premier group of entities prodding consumers to shift from credit cards to debit transactions, allowing them to defer payments with zero interest and skipping credit checks.

Bold acquisition

When it comes down to strategic rationale, Wedbush analyst Moshe Katri said it's a transaction that greatly expands the number of users on the consumer aspect of the business.

According to Bank of America's market observers, the deal is a "bold acquisition," stressing that they believe Wall Street will react positively to the agreement from a strategic standpoint.

Part of a bigger plan 

Afterpay's 7 million customers will also directly benefit from Cash App's features including money transfer, stock purchases, and bitcoin. The integration would also be beneficial for Cash App customers because they would easily discover merchants and BNPL offers right inside the app. 

Afterpay's acquisition is part of Dorsey's bigger plan to bring bitcoin into mainstream use. On top of the acquisition, the billionaire also announced a plan last month about the creation of an open-source platform for decentralized financial (DeFi) services.