London-based Zilch, a startup that claims to be redefining the Buy Now, Pay Later (BNPL) marketplace, has raised an additional $30M (approx €24.5M) in equity funding. The additional funds will help the company to close its oversubscribed pre-Series B round in less than 3 weeks.
Recently, the company claims to have become the UK’s first BNPL FinTech to secure a consumer credit authorisation with the Financial Conduct Authority (FCA). With this, Zilch is now in prime position to continue scaling its over-the-top BNPL business. According to the company, it has witnessed customer registration numbers quadruple over the last 6 months and transaction volume grow by more than 100% month-on-month
Hence, in the current round, the company has introduced a number of strategic investors including one of the world’s largest VC funds, Gauss Ventures and Simon Nixon (Seek Ventures and co-founder of Money Supermarket).
The new AmEx?
Founded in mid 2018 by founder Philip Belamant and co-founder Serge Belamant, Zilch claims it is the first over-the-top (OTT) BNPL product that allows its customers to shop wherever Mastercard is accepted and spread their payment over 6 weeks for zero interest and zero fees from one of Zilch’s 5,000+ retail affiliate partners.
Unlike traditional BNPL products that require technical integration with merchants, the company claims its (patent pending) model does not require any integration and can thus instantly provide its users’ accessibility everywhere. This gives Zilch the ability to scale rapidly. According to the company, it is one of the reasons why customers are calling it, “a shopping revolution” and more recently, “the new AmEx”.
The company delivers its unique proposition to customers by leveraging its strategic partnership with Mastercard. Zilch CEO and founder, Philip Belamant says, “Zilch ensures customers never over-borrow. We make use of Open Banking and AI along with soft credit checks to determine each customer’s level of affordability. As a result, Zilch’s customers rarely default and make use of the product as a cash flow management tool, which has proven to be of huge value to our customers.”
Through Zilch, customers can pay online at big brands such as Amazon, eBay, Ali Express, Nike, and more, and will soon be able to “tap and pay overtime” in-store too.
In mid-November, Zilch announced the launch of its latest feature on the app called “Snooze”. Using opening banking, Snooze grants customers the power to affordably delay repayment on an installment, or an entire payment plan, by 4-7 days without any interest or hidden fees. The development was done to help customers manage their cash flow, and to reduce financial stress and maintain financial wellness.
Previously, in October, the fintech had partnered up with Credit Kudos, to use their open banking affordability platform and promote responsible lending to more customers. Open banking has helped Zilch take the lead in the sector, applying rigorous affordability and creditworthiness checks while maintaining a fast, simple on-boarding process.
Prior to that, in September, the company had raised $11M (approx €8.9M) in fresh funding to continue scaling its unique over-the-top Buy Now Pay Later (BNPL) business. The fintech launched its BETA product in August 2019 and was operating in stealth mode till the funding. At the time, the company was experiencing a huge amount of traction in the young millennial and GenZ market and was growing by more than 10,000 new customers a month.
The company is growing fast and hence hiring multiple positions to boost its product management team to concentrate on product growth and optimisation.