Japan-based buy now, pay later (BNPL) firm Paidy launched Paidy Link, an app feature that lets customers connect mobile wallets to their Paidy accounts. Paidy enables customers to split purchases at participating merchants into as many as 36 monthly installments and also offers 3-Pay, a new payment solution that lets customers pay for purchases in three interest-free monthly installments. PayPal is the first Paidy Link partner, which lets customers shop at PayPal’s global merchants via Paidy’s app and pay for purchases in monthly installments. Paidy says the integration will roll out to other mobile wallet providers in the future.

The tie-up follows Paidy’s multimillion-dollar funding rounds as Japanese consumers lean further into credit card alternatives. The firm recently raised $120 million in Series D funding after a $48 million round last April. According to its latest figures, Paidy works with more than 700,000 merchants and has over 5 million customers, covering about 4% of Japan’s population. As in most global markets, the pandemic lifted Japan’s ecommerce sector and could have made consumers more interested in flexible payment solutions, which likely boosted Paidy’s business—especially because weak credit card adoption among Japanese consumers may have pushed them to alternatives.

Integrating with mobile wallets like PayPal can help make Paidy’s service more appealing to customers, especially as Japanese consumers develop an appetite for cross-border ecommerce. The feature helps expand Paidy’s existing merchant base by letting customers use the service at merchants that may not take Paidy but do accept partner wallets. For example, the PayPal partnership will now let Paidy customers shop at PayPal’s 29 million global merchants at a time when Japanese cross-border ecommerce is on the rise: In 2021, Japan’s share of cross-border ecommerce buyers is expected to grow 8% annually to reach 19.1 million—a jump from last year’s 5% increase, per eMarketer forecasts from Insider Intelligence. For PayPal, the tie-up will give its merchants direct access to Paidy’s customer base, which could help it drive more volume in Japan, where it has struggled to retain customers.