Australian Listed Zip has announced plans to fully acquire South African buy now pay later (BNPL) platform Payflex in its global expansion move.
Zip is present in twelve markets across five continents and its launch in South Africa will help it expand across other African markets to serve the millions of underbanked and digitally savvy populations.
According to Paul Behrmann, founder and CEO of Payflex, “The growth of Payflex over the past few years has demonstrated the demand for BNPL in South Africa. Zip’s acquisition will boost the speed and scale of Payflex’s expansion and allow merchants and shoppers to benefit from Zip’s world-class products, platform and global reach. It is also a significant vote of confidence in the all-South African Payflex team, which will remain unchanged and focused on growing the business.”
Payflex, the first and largest BNPL player in South Africa has a customer base of over 1,000 active merchants including leading brands such as Superbalist, Cotton On and Runwaysale. Over 135,000 customers have used Payflex – five times the customer base of 25,000 it had in August 2020.
“This has been a truly transformational 12 months as Zip has continued to deliver, despite the most exceptional global economic conditions. We started the year with a clear strategy for global expansion, and we have seen record growth, ending the year with $5,8b in total transaction volume, and more than 7.3M customers and 51k merchants around the world,” said Larry Diamond, Zip managing director and CEO.
The platform allows Payflex shoppers to split the cost of their purchase into four equal installments, payable over 6-weeks, interest-free. Shoppers can apply in seconds with no paperwork, and a late fee is only payable if they miss a scheduled installment. Customers can pay their Payflex installments with any Visa, Mastercard or American Express card.
“Shoppers definitely prefer to pay for their purchases in interest-free installments when given the choice. A recent survey revealed that 80% of shoppers would not have made their most recent online purchase if not for the BNPL offering. The volumes reported by SA merchants mirror global trends, which is driving a massive rise in the number of merchants offering BNPL,” says Behrmann.
Payflex increases merchant sales by 30% on average, and drives improvements in other key business metrics, such as cart abandonment, order frequency, revenue and new customer acquisition.
Payflex plans to launch an in-store offering later this year, which will significantly expand the reach and market for the Payflex BNPL solution.
