FinTech: Target To Test BNPL Waters With Sezzle
Buy-now-pay-later, or BNPL, offers are highly popular with shoppers these days.
Shoppers are making a beeline for offers that allow them to pay for their purchases in installments. Also known as BNPL products, these installment facilities, generally interest- and fee-free, are grabbing share from credit cards. Sezzle (ASX: SZL) is a leading BNPL platform with 1.6 million customers across the U.S. and Canada. It announced today the launch of a Proof Of Concept (POC) with retailer Target Corporation (NYSE: TGT). (The Motley Fool)
Sezzle shares shoot 5.5% higher
Shares of Sezzle settled today at A$6.91, up 5.5%, after the announcement of the tie-up with Target. Target is one of the world’s largest retailers with a current market capitalization of over $77 billion. Sezzle’s buy-now-pay-later platform will be used for limited tests with a small portion of Target.com guests in two product categories.
The test run will evaluate whether Sezzle’s BNPL platform can operate efficiently together with Target’s retail operations.
Sezzle has promised to deliver an update on the result of the PoC trial once it completes it.
Target shares surge 20% in August
Target posted solid results for the second quarter of 2020.
On the top line, the company delivered second-quarter comparable sales growth of 24.3%, the strongest ever reported. Equally remarkable on the bottom line, the retailer generated an adjusted EPS of $3.38, a new record high.
The retailer could boost its results through the judicious use of its online and physical stores. According to The Motley Fool, it used its store network as an efficient source of e-commerce shipments.
Sezzle partners with Ally Financial
In further testimony of the rising interest in the BNPL space, Ally Financial Inc. (NYSE: ALLY) announced last week a partnership between Ally Lending, its personal lending division, and Sezzle. By 2021, Ally Lending and Sezzle will integrate into each other’s platforms.
“We anticipate some really strong growth coming out of this in the retail space,” said Hans Zandhuis, head of Ally Lending, to the Charlotte Business Journal.
Related Story: Sezzle Makes Its BNPL Virtual Card Available In-Stores
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