The price of Block inc American Depositary Receipts (ADRs) on the ASX are up 6.8 per cent this morning to $183, returning to where they sat last Thursday.

This follows a similar move in Block Inc shares on the Nasdaq overnight, where Block gained 6 per cent to $US138.12 as it recovers from hitting a two-year low four weeks ago.

And Zip Co shares are also higher, up 7.5 per cent as they recover from a recent two-year low of $1.40. While it’s takeover target, Sezzle, is up 6.4 per cent to $1.42, also recovering from recent two-year lows.

While today might look good, the long-term outlook for buy now, pay later (BNPL) operators is cloudy, according to portfolio manager Alex Gabriele from Morgan Stanley’s Global Quality Fund and Global Sustain Fund.

Mr Gabriele told a journalist briefing this morning that his portfolio has some exposure to consumer credit through Visa, but does not directly own any BNPL stocks.

“BNPL is sort of a weird phenomenon because everyone talks about it like its something new. It’s not new,” he told a briefing with journalists this morning, adding consumers have had access to in-store financing for decades.

“It is slightly different now because they wrap it up in an app and make it out like the app is revolutionary. BNPL is just another form of unsecured financing (and) if there is stress on the system that kind of financing comes into trouble.”

He also warned BNPL would probably face more stringent regulation.

“As soon as it starts to cause stress on the most vulnerable…it immediately, very quickly becomes political and it immediately, very quickly becomes regulated.”

BNPL remains unregulated as a payment instrument or credit product in Australia. But, the Reserve Bank has been conducting reviews into the sector, especially surcharges on merchants, and was yet to announce any new regulations.