Scalapay CEO Rejects BNPL’s Super Apps Strategy

Competition in the Buy Now Pay Later (BNPL) space has intensified in recent years as established players compete with new entrants vying for a slice of the growing pie.

And in Europe, where customers are quite conservative when it comes to credit, a focus on smaller baskets can be the deciding factor to jump out at local and regional competitors who focus primarily on large purchases.

“Most of the retailers in Italy, France and Spain were quite skeptical and thought their customers would not need [BNPL] For 30-50 euros of products, but we were able to prove that they were very useful. And once they activated Scalapay, they noticed that 10-20% of customers immediately adopted it. Simone Mancini, CEO of Milan-based BNPL Scalapaya, told PYMNTS in an interview.

read more: Scalapay, a European provider of BNPL, has raised nearly $500 million

Adhering to this strategy seems to have worked for them. Italy’s Unicorn, which also has a presence in France, Spain, Portugal and Germany, has raised nearly $730 million in just two years since its launch, part of which has been acquired by Poste Italiane, one of the largest. Infrastructure service in the country. Providing financial, payment and digital services to homes, businesses and governments.

Read also: BNPL Unicorn from Italy Scalabai She gets $27 million from Poste Italiane

In general, he said, they have been reluctant to adopt the super application strategy like some of the big BNPL players because it isolates traders who need help navigating the online markets of the world.

“The philosophy, when it comes to some of the big players, we disagree is that we don’t want to put the trader away from the broker. We are not here to create a great app or to develop our own market. We are really interested in trying to help traders, [and] “There are many opportunities to improve this,” he said.

Building a sustainable lifestyle

To further mitigate the impact of transactions on customers’ monthly budget, Scalapay has partnered with UK-based next-generation FinTech Twig to allow customers to resell previously purchased electronics and fashion products. Via Scalapay and Twig pays them instantly.

Related news: BNPL Scalapay Platform Partners with FinTech Twig on Sustainable Procurement

“All of a sudden, there are people who buy a bag or a dress and instantly resell it at a fixed price that Twig sets using an algorithm, it’s exciting,” he said.

For Generation Z and Millennial consumers targeted by Twig, making a purchase while ensuring they can be resold immediately at any time makes the shopping experience more “enjoyable,” he says, and allows them to focus on building a sustainable lifestyle. , which is a growing trend in the region among this group of clients.

With BNPL penetration still very low in southern Europe, Mancini said there are many untapped opportunities in the different markets it operates in. In this context, the company recently launched travel as a vertical and plans to expand in-store QR code card payment functionality.

Earlier this year, the EU-focused company also launched Magic, a payment solution to help European merchants transform the entire payment experience, a move it says is part of its core strategy. Aiming to “empower merchants and help them deliver amazing products, [frictionless] customer experiences.

No obligation to sell at the moment

As more consumers seize the opportunity to pay for their retail purchases in installments, the trend of consolidation has dominated the BNPL space, with Australian Zip recently acquiring US lender Sezzle in a $352 million deal.

Related: Sezzle and Zip Deal Show BNPL Consolidation Trend Can Continue In 2022

Mancini assured PYMNTS that all European BNPL players have approached them with proposals, especially given the attractiveness of European markets, which include some of the world’s largest fashion and cosmetics brands.

But being early on the adoption curve means there are plenty of untapped opportunities in the BNPL space, and Scalapay will be looking to explore them on its own, at least for now.

“I think payment and the future of e-commerce is very exciting, and being able to raise the most amount of money has also put us in a very advantageous position where we can continue to realize our vision for years to come. So, we have no obligation to sell in the short term,” Mancini said.

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New payment information: Custom Purchasing Experience Study – May 2022

on: The PYMNTS survey of 2,094 consumers for the Personalized Shopping Experience Report, a collaboration with Elastic Path, shows where merchants are doing well and where they need to up their game to deliver a personalized shopping experience.

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