Alliance Data’s Bread business will offer its pay-over-time installment loan product through Sezzle’s merchant network. Through the integrated partnership, Sezzle will leverage Bread’s deep underwriting and installment loan product to reach more customers buying big-ticket items, while offering a comprehensive product suite to its merchant partners. Bread is a leading payments technology company that enables seamless checkout experiences. Its white-label digital payments platform will operate alongside Sezzle’s to give Sezzle and its more than 40,000 merchants and future partners more options at checkout. With convenient terms (3-48 months) and interest rates starting as low as 0% for certain loans and qualifying customers, Bread’s installment loans will complement Sezzle’s existing buy now, pay later product, while simultaneously accelerating growth opportunities for both businesses. Through the partnership, Bread will originate the loans through its affiliate Comenity Capital Bank.
Payo is a dine now, pay later app that lets users leave the bill for another day – by paying for it over four smaller payments, interest free. The app has a directory of venues that accept Payo, so users can filter by cuisine, location and special deals. The app also allows them to make a booking, and it keeps track of spending so they know how much is spent. QR codes help follow pending payments, and users can split each bill into four equal instalments. During its trial, the average order value from Payo customers was up 50 per cent on regular orders, the app allowing customers to spend without burning a gaping hole in their bank balance. Payo users also have access to exclusive, limited-time offers from partner restaurants.
- A new research paper by Discover® Global Network found digital payment services and financial technology partnerships are reshaping the way in which consumers around the world send, spend and store their money. The COVID-19 pandemic shed light on the influence of these digital payment services – as they grew market share and consumers accelerated their usage and adoption of these products. The report analyzes these shifts and other trends prevalent within the industry.
- Globally, 1 in 3 consumers began using digital payments for the first time within the last year, while more than half (52%) said they transitioned all or most of their in-store spending to online. Further, 49% say they are now more comfortable with making digital payments as a result of COVID-19.
- According to the report, in 2020, digital wallets are reported to represent 27% of in-store spending, 41% of e-commerce spending and 46% of mobile commerce spending. By 2025, digital wallets are projected to account for more than $10 trillion in global transaction volume between in-store and e-commerce.
- Nearly 9 out of 10 fintech vendors said contactless payments and linking loyalty programs and rewards to a customer’s payment card were relevant to their business needs.
- Seventy eight percent of fintechs indicated they currently partner or work with a payment network, and an additional 18% said while they don’t currently, such a partnership is possible.
- Digital wallets ranked as the most widely used digital payment service overall, with respondents in Singapore (74%), India (70%) and China (61%) exhibiting the highest increase in usage. In these markets, many digital wallets have evolved into “super apps,” encompassing a wide range of services, from payments to purchasing movie tickets to insurance.
Westpac has revealed that it’ll launch a “Flex” zero-interest credit card later in the year, that will offer consumers access to $1,000 credit with no interest, late or foreign currency fees and will be accepted anywhere that takes Mastercard transactions. As opposed to a regular Mastercard credit card, Flex users will be charged a flat $10 monthly fee. In addition, Westpac will waive this surcharge for consumers who pay their instalments for the month on time. Once the card launches and a prospective consumers application for the Flex card has been approved, consumers will be able to use the digital card almost immediately via both the bank’s mobile app or digital wallets like Google Pay. Westpac customers will be able to apply for the card via the bank’s mobile app or website from today.
BPL provider Laybuy’s research provides insight into consumer views on credit products following the Government’s recent consultation on future regulation of the sector. When asked which financial products they identify as a credit product, BNPL was more consistently identified (73%) as a credit product than other more traditional forms of credit such as overdrafts (70%) or even mortgages (69%). The top result was credit cards, which 87% of respondents identified as a credit product. When asked whether BNPL providers should carry out credit checks, 81% agreed that credit checks on financial history should be carried out before a customer can access the product. Presented with the choice between a hard or soft credit check, there was strong support for both, but slightly greater support for soft credit checks (75%) compared to hard credit checks (63%). Additionally, when asked whether BNPL should report usage of their products to other credit companies, 71% agreed that sharing the information is necessary. Finally, when asked when they thought it was best to carry out hard credit checks.
Auto refinancing website MotoRefi is shaking up the long-standing practice of bundling policies putting all their coverage in the hands of one carrier, by offering a new option—bundling insurance with auto loan refinancing. When a consumer comes to the MotoRefi website to seek a better deal on their car loan, they’ll also have the opportunity to be connected with an insurance carrier that may also offer lower coverage costs. The insurance industry’s method of bundling is “horizontal” providing convenience for the customer while boosting a carrier’s profits. MotoRefiis rotating that concept 90 degrees, by launching vertical bundling, the idea that customers can bundle auto insurance with the refinancing of their car. Just how much money can be saved on auto insurance depends on the vehicle, driver and coverage level. But the company is using the same model, that is saving those who refinance their car loans through the site about $100 a month. MotoRefi’s newest gambit combining auto loan refinancing with an insurance matchmaking service is not only a good business move, but an innovative combination of two technologies. This is really bringing fintech and insurtech together in auto to help the consumer using cutting edge technology.
Billie has been around since 2016 and has actually been working in the concept of “BNPL” targeting businesses long before that became an established concept and term, as part of a bigger suite of products to service businesses and their incoming and outgoing payments needs. Its ambition was simple: since B2B transactions make up more than twice the volume of B2C transactions, there should be more tools for businesses — especially SMBs — to make those transactions as easy to handle as B2C ones. Its other main product, in addition to the financing point-of-sale tool, is an invoicing service to help businesses collect money from others. Klarna’s investment comes on the back of a major strategic deal between it and Billie. The two are integrating their services, and it will mean that in cases where Billie has a stronger payments relationship, but a consumer transaction arises, Klarna will handle the sale; and in cases where Klarna is present but Billie is not, and a business is doing the buying, Billie’s services will kick in.
Santander Consumer Finance, Banco Santander’s specialised consumer finance unit, has created ‘Simplifi’, an initiative that was conceived with the aim of contributing to the promotion of financial education in Spain. Simplifi includes various online tools, such as Akana, Tu Futuro Próximo, and now also Simple Finance, which offer users free courses on personal finance and tips on savings and responsible consumption.
- Akana is a service that makes it easy to quickly know the situation of accounts using objective data extracted from the movements. After analysing more than 50 parameters, the result is presented to the user in a simple, highly visual way, providing a personalised analysis that can be understood at a glance. It also includes numerous metrics and tips related to the user’s financial situation so that they can apply them in their daily lives.
- Simple Finance is a virtual economy and finance classroom offering free courses on essential topics of personal finance, which help people to learn concepts that are useful to keep their finances under control, know what they do with their money and avoid making financial commitments they cannot afford. The courses are highly educational, with explanatory videos and downloadable materials, which teach each subject simply and accessibly.
TuFuturoPróximo is a blog that uses a simple, accessible language to keep users up to date with the latest financial developments. It includes content and tips on trends, financial health, savings and responsible consumption. Readers are invited to subscribe to a monthly newsletter containing the best articles on trends.
- A recent piece of TikTok finance advice has struck terror into the hearts of payment app users, claiming that anyone who receives more than $600 on platforms like Venmo, will receive a 1099-K tax form starting next year. However, these TikToks are leaving out a bit of vital information, probably in the quest for more enraged views. Users most likely will not have to move larger payments away from their preferred app, or pay a sort of sales tax on large money transfers between friends or family members. While there are some policy changes afoot, taxes on larger payments will be mostly aimed at business transactions, not individual person-to-person payments. The impetus for the misleading social media finance tips comes from the American Rescue Plan Act of 2021. The act modifies the IRS reporting requirement for payments on apps from the previous threshold of $20,000 down to $600, and will go into effect Jan. 1, 2022. While this threshold is significantly shorter, it should only apply to business accounts on each platform. PayPal says the American Rescue Act will be affecting tax reporting thresholds as stated, but will only be applicable to payments for goods and services, not to friends and family. It’s also important to note that these changes should be industry-wide and not specific to PayPal or Venmo.
- While it’s likely that Zelle’s policies will be altered in similar ways to Venmo’s and Paypal’s, the platform declined to say anything specific enough to reassure users.A user may only receive a 1099-K form if they receive more than $600 on a Cash for Business account starting in 2022. Regular accounts seem to be exempt. It’s important to note that those who do receive a 1099-K form next year, they are not doomed to pay an additional tax.
Australia’s central bank said BNPL firms will no longer be able to prohibit merchants from passing on surcharges for their services, robbing the fast-growing sector of one of its key advantages. Following a two-year review, the Reserve Bank of Australia, was now engaging with Treasury on “regulatory approaches” to enforce its decision – a move fiercely opposed by the industry. The central bank noted BNPL services tend to be quite expensive for merchants to accept and it “has now concluded that there is a public interest case for BNPL providers to remove their no-surcharge rules.” The RBA’s move is a step in levelling the playing field with banks and credit card providers, who cannot ban merchants from passing on their fees to customers. However, the BNPL sector is still not bound by Australia’s credit or responsible lending laws, primarily because it does not charge interest. The RBA also said it would force eight banks and debit card issuers with about A$4 billion in annual debit transactions to give merchants a multiple network option that would allow payments to be processed more cheaply. A multiple network option allows businesses to choose cheaper domestic systems instead of the prevalent but more expensive Visa Inc and Mastercard Inc networks.