SOUTH AFRICA—South African buy-now-pay-later (BNPL) provider PayJustNow has partnered with alternative lender Merchant Capital to expand retailers’ access to working capital with a new cash advance offer, PayJustNow Advance.
The partnership between the two will enable small and medium-sized businesses to innovate and scale their operations, further contributing to economic growth and job creation.
PayJustNow merchants will receive a personalized funding offer directly to their inbox based on cash flow and affordability data.
“The retail sector is experiencing a challenging trading period with economic headwinds leading to declines in retail sales as cash-strapped consumers tighten the purse strings. With quick access to the right funding, we believe South African retailers have a better opportunity to leverage opportunities to grow and thrive,” said Craig Newborn, CEO at PayJustNow.
“We needed to partner with an entrepreneur-led business that understands South African businesses’ challenges. The current market conditions heighten the need to keep fuelling retailers’ growth through innovative payment and funding solutions.”
Launched in 2019, PayJustNow is South Africa’s largest BNPL provider, with over 1.3 million customers, 2,500 directly integrated merchants, and 8,000 points of presence nationwide.
Merchant Capital, meanwhile, is a leading provider of alternative funding in the form of working capital to SMEs through its customized, technology-led lending solutions.
“Our rich data gives us a deep understanding of our merchants, ensuring that the funding contributes to their growth rather than to the detriment of their cash flow. Retailers can apply for a PayJustNow Advance immediately or when the time is right for them,” said Newborn.
This comes as South African retailers turn to interest-free alternative credit options as consumers seek safer and more cost-efficient ways to fund key purchases amid challenging economic conditions and a constrained spending environment.
The most recent Stats SA data reveals a 0.9% decline in retail trade sales in 2023 compared to 2022. The decrease is attributed to a tough economic environment that stifles consumer discretionary spending.
However, PayJustNow’s latest data reveals the BNPL provider more than doubled its gross merchandise value (GMV) in 2023, achieving 105.8% year-on-year growth.
The rapid growth in BNPL adoption indicates a desire among consumers to fulfill their essential and aspirational purchases while avoiding costly interest. This represents a significant opportunity for retailers facing declining retail sales in constrained spending.
According to its data, nearly two-thirds (65.4%) of PayJustNow’s gross merchant value is generated by customers aged 27-42, and 68.5% of PayJustNow users are female.
Newborn said the PayJustNow Deals platform is also fast becoming one of the leading shopping platforms for South Africans seeking deals and promotions across various products and services.
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