Amazon Australia announces partnership with Zip Co. for BNPL service
Category: #headlines  By Anchal Solanki  Date: 2019-11-08
  • share
  • Twitter
  • Facebook
  • LinkedIn
Amazon Australia announces partnership with Zip Co. for BNPL service

 

  • Zip would become Amazon’s first “Australian installment payment option”.
  • Zip shares soared around 24.1%, right after the market open to A$4.27.

E-commerce giant, Amazon Inc.’s Australia unit has reportedly entered into a strategic agreement with Zip Co. Ltd. to offer buy now, pay later (BNPL) services on the Amazon Australia retail website. Sources close to the move cite that the agreement with Amazon is a huge boost for Sydney-based Zip as it is a relatively small player in the fast-growing BNPL sector.

Reportedly, Zip’s payment system went live on the Amazon Australia website on Thursday. As part of the agreement, the company will be issuing warrants to an affiliate of Amazon to buy 14.6 million of its shares, which accounts for around 4.2% of outstanding shares. The warrants could be used for seven years from the issued date.

Lately, installment-based transaction option has become very popular among Millennial and Gen Z shoppers, as they bypass the interest rates and many regulations associated with using a credit card. BNPL companies are making money from the vendor as well as via penalty payment when consumers are late while paying back a loan.

Jun Bei Liu, portfolio manager at Tribeca Investment Partners, said that the agreement was a win for both Amazon and Zip. BNPL services serve a great purpose, especially in a slower retail environment by attracting consumers to retail sites, claims Liu.

Incidentally, the rise of the BNPL sector has also brought regulatory scrutiny. Recently, the Reserve Bank of Australia (RBA) said that it planning to go deeper into this sector next year. Moreover, this year, financial crime watchdog AUSTRAC ordered an external auditor report of Australian fintech firm Afterpay Touch Group for suspected non-compliance with money-laundering and counter-terrorism financing laws.
 

Source Credit - https://www.cnbc.com/2019/11/06/reuters-america-update-1-amazon-australia-signs-up-zip-co-buy-now-pay-later-service.html

  • share
  • Twitter
  • Facebook
  • LinkedIn

About Author

Anchal Solanki

Anchal Solanki    

A civil engineer by qualification, Anchal Solanki forayed into the domain of content writing in the midst of her graduation, embarking on the career path of a successful freelancer. Equipped with a short-term experience in market research, Anchal currently writes news...

Read More >>

More News By Anchal Solanki

Vestas obtains 139MW turbine supply order from MHI Vestas Offshore Wind
Vestas obtains 139MW turbine supply order from MHI Vestas Offshore Wind
By Anchal Solanki

Turbine manufacturer Vestas has recently secured a supply order for 33 turbines from MHI Vestas Offshore Wind. Vestas will provide 139 MW of V117-4.2MW typhoon turbines to the first offshore project of utility-scale in Japan, located in the region&rs...

Global Pipeline Monitoring Systems Market: Deep Company Profiling of Leading Players 2020-2026
Global Pipeline Monitoring Systems Market: Deep Company Profiling of Leading Players 2020-2026
By Anchal Solanki

The Pipeline Monitoring Systems Market analysis document represents a detailed collection of prioritized market definitions, industry scope and reach, and pivotal industry insights. Information about the many pitfalls of the Pipeline Monitoring Syste...

Global Timing Device Market: Things to Focus on to Ensure Long-term Success 2020-2026
Global Timing Device Market: Things to Focus on to Ensure Long-term Success 2020-2026
By Anchal Solanki

The Timing Device Market report encompasses an in-depth analysis of the business space in question. All the growth facilitators responsible for furling the revenue scope of this industry are mentioned in the study in conjunction with the competitive ...