On Monday, market battler and BNPL platform Splitit Payments [ASX:SPT] announced a new agreement with Google to expand its instalments solutions on the Google Store beyond its original Japan deal.
The fintech expects to have its Google-linked services available in the US, Canada, and Australia from early 2023.
SPT’s share price rose by around 5.5% in the early afternoon, pushing its share value up 46% over the last month.
Unfortunately, despite performing better than its sector average, year-to-date the BNPL stock is still down 24%.
It’s also down 26% compared with the market average over the past 12 months.
Source: tradingview.com
Splitit’s Google store expansion
The long-suffering BNPL platform has revealed an expanded opportunity with Google to reach broader markets on the Google Store app.
Now the payments solutions group will be able to gain specialised access to American, Canadian, and Australian consumers, offering its payments services via the Google Store app and thereby increasing its reach and accessibility on a growing global scale.
Previously the payments company signed an agreement with Google in January 2021 in order to facilitate spending options on the Google Store in Japan — the event went live in April.
Splitit, a white-label service that allows customers to pay in instalments at checkout, has now signed the extended partnership with Google, which the company says has been a main priority this year and represents a new milestone.
The company believes the extension will have a material impact on Splitit’s brand and business development prospects but also acknowledged the variable nature of revenue, which ultimately comes down to customer response to – or uptake of – the products on offer.
For this reason, Splitit could not provide details or set an expectation for economic materiality involved with the Expanded Google Agreement.
‘The Expanded Google Agreement shall remain in full force for an initial term of one year and shall be renewed automatically for successive periods of one year, unless a party gives written notice of non-renewal or unless the Expanded Google Agreement is terminated earlier,’ explained SPT.
‘All other terms of the Expanded Google Agreement are not relevant to assessing the impact of the transaction on the price or value of Splitit’s securities.’
Speaking of securities, shareholders have approved the exercise price of 2,166,667 existing warrants held by Goldman Sachs and 4,333,334 warrants to be issued, reduced to $0.18 upon Splitit drawing facility funds.
SPT, inflation and the holiday season
Inflationary pressure has been constant, and though the situation isn’t likely to change going into 2023, there are factors giving the fintech sector a boost in the short term.
The beginning of the holiday season has seen consumers flash cards across retailers over varying sectors, especially with recent Black Friday and Cyber Monday sales — which overturned 17% more in average weekly spending.
Splitit shared a surge in sales, reporting an average spend of $1,179 between the dates of 21 and 28 November, highlighting the need for spread-out payments.
‘Our data shows that consumers are happy to spend this holiday season despite inflationary pressures,’ said SPT’s CEO, Nandan Sheth, and took the opportunity to highlight SPT’s role:
‘Splitit gives consumers greater flexibility to manage their finances by leveraging existing credit without taking out new financing to complete their holiday purchases. The gift Splitit brings for retailers is having complete control over the entire shopper experience you don’t get with legacy BNPL providers. Splitit’s white-label approach, embedded in the existing customer journey, ensures brand consistency while driving loyalty and repeat purchases.’
Fintech stocks for 2023
Fintechs suffered from their ‘growth-over-profit’ strategy in 2022, but many can still provide valuable opportunities — at the right price and with the right growth prospects.
Some fintechs can even grow into lucrative businesses in the long-term.
Especially as they move their focus to profits once more.
Our market expert, Ryan Clarkson-Ledward, has done the necessary research required for discerning opportunities.
He’s discovered three already profitable fintech stocks flying under the radar. One of them, he says, is a start-up ‘wrestling with the big banks — and winning’.
Get Ryan’s free research report here.
Regards,
Mahlia Stewart,
For Money Morning
