Australian businesses now have another instalment payments tool at#nbsp;their disposal to#nbsp;encourage customer purchases and the startup’s chief executive says smaller merchants should accept that multiple payments platforms are the new normal.
Israeli payments business Splitit listed on#nbsp;the ASX on#nbsp;Tuesday and rocketed 90 per cent from its offer price of#nbsp;20¢, lifting to#nbsp;38¢ at#nbsp;the market close and heading another 27 per cent higher on#nbsp;Wednesday morning, to#nbsp;48¢.
Customers are increasingly keen to#nbsp;split their payments, says new ASX-listed Israeli startup Splitit. CREDIT: PAUL JEFFERS
The company allows Visa and Mastercard users to#nbsp;pay for goods with their credit cards and then pay off their card balances in#nbsp;instalments, rather than having everything due at#nbsp;the end of#nbsp;the month.
Splitit joins Afterpay, Zip, Openpay and a#nbsp;range of#nbsp;other payments options in#nbsp;the local market, all vying for merchant support to#nbsp;offer different models of#nbsp;instalment payments to#nbsp;shoppers.
While each service charges businesses different fees and some founders have said paying for these processing fees is#nbsp;piling#nbsp;up. However, Splitit chief executive Gil Don says retailers have to#nbsp;think about courting shoppers with multiple options.
"If I’m a#nbsp;small business person and I#nbsp;sell electronics or#nbsp;any other stuff on#nbsp;average about value of $#nbsp;200, in#nbsp;order to#nbsp;attract shoppers, I#nbsp;need to#nbsp;give a#nbsp;few options. The question is, why shoppers want to#nbsp;buy the product?"
Splitit charges merchants a#nbsp;small percentage fee of#nbsp;around one per cent plus $US1.50 per instalment, according to#nbsp;its prospectus. It’s currently rolling out is#nbsp;offer to#nbsp;Australia.
Don says he#nbsp;is#nbsp;unconcerned about other competitors and is "a fan of#nbsp;Afterpay" because of#nbsp;its focus on#nbsp;low value, millennial-focused purchases.
"Their approach changed the market," he#nbsp;says.
Afterpay is#nbsp;still up#nbsp;983 per cent since listing, sitting at#nbsp;close to $#nbsp;1.50 in#nbsp;its first weeks on#nbsp;the ASX and $#nbsp;16.31 this week.
In#nbsp;this environment of#nbsp;multiple payments options, smaller retailers have a#nbsp;decision to#nbsp;make: how much choice than they afford to#nbsp;offer to#nbsp;customers?
"The merchant in#nbsp;the end of#nbsp;the day will decide according to#nbsp;its margins," Don says.