Zilch Launches Its “BNPL 2.0” Platform in the United States Market

The “buy now, pay later” scene has a new entrant. This week, Zilch announced its arrival in the United States. According to the company, the app launched with 150,000 pre-registered customers and comes after the service gained two million U.K customers since its debut there 18 months ago. Elsewhere, Zilch has raised $400 million in debt and equity from Goldman Sachs among others and the company is valued at more than $2 billion.

Like other “buy now, pay later” platforms, Zilch allows users to pay off purchases in four payments made over six weeks. While customers will need to pay 25% of their balance at the time of purchase, subsequent 25% payments are due two weeks, four weeks, and six weeks after the transaction. Alternatively, however, Zilch customers can elect to use the platform to pay for their purchase in full upfront and earn 2% in Zilch Rewards as a result.

To get started with either option, customers can select the store they plan on shopping in (or select the Zilch Anywhere option), choose their payment plan, and generate a Zilch card, which is accepted anywhere Mastercard is. From there, users are able to manage payments and turn on Auto Billing in the app. Notably, loans through Zilch USA are made by Cross River Bank — a FinTech-friendly bank that recently raised a $620 Series D.

Speaking to the idea behind Zilch, the company’s co-founder and CEO Philip Belamant said in a statement, “In 2020, U.S. consumers paid $120 billion in fees and late charges to credit cards, which we believe is unacceptable and fundamentally misaligned with the interests of consumers. They are being set up to fail and need more flexibility, especially during a cost of living crisis and a time of surging inflation, to pay for goods and services how and when they want – with a system that avoids late payments and unnecessary, onerous fees.”

Belamant went on to note the company’s success and what led them to America, saying, “Our experience in the U.K., and the survey we conducted here in the U.S., make it clear that U.S. consumers want much more from BNPL providers, what we call BNPL 2.0 – which removes what consumers dislike (lack of ubiquity/fees and/or late charges). Zilch also gives what consumers say they value – cashback, which can be used to discount larger purchases.”

Ultimately, while Zilch might position itself as “BNPL 2.0,” there’s not much that differentiates it from the field — at least not on the surface. While the 2% cashback option is interesting, it’s currently not exactly clear what Zilch Rewards can be redeemed for, which would definitely impact the appeal. Furthermore, with the “buy now, pay later” field growing ever more crowded, it will be interesting to see if Zilch can continue the momentum it’s seen in the United Kingdom. Of course, on that note, only time will tell.


Also published on Medium.

Author

Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Bilt Rewards Launches Travel Portal with Benefits for Cardholders

Last year, the startup Bilt made a splash when it announced a new service that would reward users for paying their rent. That premise was then expanded upon with the launch of the Bilt Mastercard, which is issued by Wells Fargo. Now, continuing to capitalize on both the hype of their product and the demand for travel, Bilt has debuted another new offering for customers. This week, Bilt Rewards announced...

Cash App Introduces Round-Up Investing Feature for Debit Card

Debit card customers looking to grow their investments gained a new, automated option today as Block Inc. (formerly Square Inc.) officially announced a new feature for its popular Cash App. Now, customers with the Cash App Cash Card can opt into Round Ups as a means of growing their investments. When this feature is toggled on, Cash App will round up debit card purchases to the nearest dollar and invest...

Marqeta Expands Credit Program with New APIs and More

A FinTech that specializes in creating credit card experiences is rolling out some new features. This week, Marqeta announced what it calls a "significant expansion" of its credit platform. This includes more than 40 new credit APIs that will further help clients craft and launch their own credit card products. Additionally, the company notes an updated intuitive dashboard. Using this platform, businesses can create unique card options that can not...