SOUTH African fintech start-up Payflex said yesterday that Australian-listed multinational Zip Co had invested in it the firm.
Paul Behrmann, Payflex chief executive and founder, said the investment and support by Zip Co was a vote of confidence in local fintech innovation and the market opportunities inherent in South Africa.
Payflex’s buy now pay later player (BNPL) model allows customers to shop at more than 650 online stores such as Cotton-on, Superbalist and The Pro Shop. Payments are split over four interest-free instalments.
Zip Co is a BNPL with a market cap of more than R55 billion.
“Although Zip was launched in Australia, it has expanded into the US, Britain and New Zealand. With a leader in the BNPL space investing in Payflex from inception, we have the financial muscle to expand our footprint and provide merchants with comfort that the company they are dealing with has solid financial backing,” he said.
Payflex said it had quadrupled customer sign-ups as e-commerce boomed amid Covid-29. Local online retail was set to pass the R62bn mark this year, almost 4.5 times the 2018 figure of R14bn, it said.
Behrmann said Covid-19 had changed the rules of retail: greater competition, rapidly changing customer expectations and the emergence of new technologies had caused fundamental changes.
“Consumers will continue to demand greater personalisation and convenience, simple payment methods and more control over their finances, so merchants need to ensure online shopping is part of their growth strategy,” he said.
“South Africans need a payment solution that does not rely on costly credit and is simple to use. Traditionally, paying via instalments in South Africa has been associated with high-interest charges. But this BNPL solution allows them to plan ahead and make interest-free purchases,” said Behrmann.
BUSINESS REPORT ONLINE