Need to Know
- Visa is expanding its fintech integrations by partnering with Splitit, allowing merchants to offer customers different payment options.
- Using Splitit, customers can buy now and pay up to 24 months later, with no interest.
- Deferred payment apps (otherwise known as buy-now-pay-later) are a growing trend in online shopping, with related downloads surging to six million in 2019.
- Splitit’s revenue grew by 108% in 2019.
Visa has announced a partnership with Splitit to offer more payment options for customers. Splitit will integrate with Visa’s new Visa Installment Solutions to provide cardholders more authority over how they pay for goods and merchants the ability to offer new payment plans.
Splitit is a “buy now, pay later” (BNPL) tech firm that gives merchants a new way to provide their customers with deferred payments. Customers can choose the number of installments they’d like to pay in up to 24 months. Payment plans are always interest-free and payment plans do not affect the shopper’s credit score.
This partnership will allow Splitit to benefit from Visa’s Developer Platform, increasing the company’s access to tools and support that provide Splitit with room to grow.
“Partnerships like this one are a major plank in our strategy to accelerate growth, and we look forward to working closely with Visa to help our merchant partners provide [an] enhanced customer experience,” said Splitit CEO Brad Paterson.
Technology for splitting payments is becoming a booming business.
The major fashion retailer, H&M, recently launched an integration with Klarna, allowing loyalty members to choose to buy now and pay later, both online and in-store. Like Splitit, customers can pay in multiple installments without paying interest.
Another BNPL app, Sezzle, has experienced massive growth since launching just four years ago. The platform just announced one million active users and over 10,000 merchants are using the payment solution.
In 2019 alone, BNPL app downloads surged 162% to six million.
Deferred payments, while convenient, put customers in the risky position of possibly spending more than they have or incurring late fees by missing payments.
Visa’s partnership with Splitit coincides with the payments giant’s ongoing interest in fintech innovation. In recent months, the company acquired Plaid for $5.3 billion, is expanding cashless payment options worldwide, and hit a massive milestone of $1 trillion in online transactions.
In Splitit’s first full year as an ASX-listed entity, the company saw a record revenue: up 108%.