Payflex, a Johannesburg-based payment solutions provider, has received significant international investment from Zip Co, an Australian-listed multinational fintech firm. Payflex CEO and founder Paul Behrmann says Zip Co’s undisclosed investment and support is a vote of confidence in local fintech innovation and will open up more market opportunities for the start-up.
“Although Zip was launched in Australia, it has expanded into the US, Britain and New Zealand. With a leader in the buy now pay later 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,” saysBehrmann.
Here Is What You Need To Know
- Zip Co, a buy now pay later fintech firm with a market cap of more than R55 billion, has a long-standing partnership with the Johannesburg-based start-up.
- Payflex localized the best features of its solutions in the buy now pay later space after partnering with ZipCo Australia, which has over 6.4 million customers.
A Look At What The Startup Does
Payflex, which was launched in 2019 in collaboration with Superbalist, allows consumers to make purchases from over 650 online merchants on the Payflex digital mall and pay later, interest-free. The payments are divided into four interest-free installments.
According to Payflex, COVID-19 has accelerated the growth of SA’s e-commerce sector, with local online retail expected to surpass R62 billion ($4.3m) this year, nearly 4.5 times the R14 billion ($984k) figure in 2018.
Customers, according to the startup, will find the buy now, pay later process simple and quick. It entails a quick assessment, and customers only pay a fee if they miss a scheduled instalment.
According to the company, merchants who accept Payflex as a payment option report higher order values of purchases by up to 70%. They’ve also seen sales increases of up to 30% and repurchase rates of up to 70%.
“Most importantly for merchants, transactions are settled daily directly into their bank accounts. Once the transaction is approved, the merchant is guaranteed payment, putting an end to the e-commerce problem of credit card chargebacks,” adds Behrmann.
When partnering with Payflex, merchants pay no setup fees and only pay transaction fees on successful orders.
COVID-19 has fundamentally changed the rules of retail, according to Behrmann, with increased competition, rapidly changing customer expectations, and the emergence of new technologies.
“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 points out.
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