BNPL firms are targeting regional expansion to tap into the fast-growing market

BNPL firms are targeting regional expansion to tap into the fast-growing market

BNPL firms are targeting regional expansion to tap into the fast-growing market

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The uncertain economic conditions and inflationary pressures have prompted consumers to delay their purchase payments by leveraging buy now pay later (BNPL) schemes. Across age groups, the adoption of BNPL has seemingly grown in the global market in 2023, and the trend is projected to further gain momentum in H1 2024. Consequently, BNPL firms are targeting regional expansion to accelerate revenue growth.

Mondu, a German-based BNPL provider, is seeking to tap into the growing demand by launching its B2B BNPL product for businesses in the United Kingdom. The launch in the UK market comes on the back of its recent expansion in countries like the Netherlands and Austria.

  • To fund its regional expansion, Mondu also raised US$13 million as part of its Series A extension in Q1 2023. This means that the firm had raised a total of US$90 million since its inception in October 2021. With further expansion in sight, PayNXT360 expects Mondu to raise another funding round from venture capital and private equity firms.

The United Kingdom holds the second-largest position in Europe's B2B commerce sector, highlighting a significant requirement for BNPL services. This need is also evident from the growing number of players offering BNPL products in the country.

As part of its expansion strategy, Mondu also entered into a strategic collaboration with Acquired.com in July 2023. The collaboration will enable Mondu to reach more businesses across Europe, subsequently driving its revenue growth from the short to medium-term perspective.

  • Toggle Market, another B2B-focused BNPL provider, has been rapidly expanding its international presence over the last two years. The firm, having operations in Europe, the Middle East, and Africa, announced that it is also expanding the presence in Rwanda and will serve SMEs seeking supply chain trade finance and payable financing alternatives.

The firm initially launched the BNPL offering for business in the F&B segment in the Middle East in July 2022. Since then, the firm has gradually rolled out the flexible payment product in various markets, including Kenya, South Africa, Congo, Nigeria, and now Rwanda. The B2B BNPL solution offered by Toggle Market will enable SMEs in Rwanda to source goods from both listed as well as non-listed suppliers. This will enable businesses to access products and drive their growth.

  • Sipay and Sileon also partnered to bring a new BNPL solution in the competitive Spanish market in 2023. The launch of the BNPL product is also part of Sipay’s strategy to further expand its product portfolio, which already includes subscriptions, billing, and intallment payment plans. For Sileon, on the other hand, the collaboration confirms the firm as an international technology provider in the fast-growing market.

The collaboration is expected to improve the value proposition of Sipay in the competitive payment market in Spain. The firm provides services to clients across sectors, including tourism, fashion, leisure, and insurance. Notably, the demand for BNPL schemes has been rising rapidly across these sectors globally.

Leveraging Sileon's SaaS technology, Sipay is now capable of providing merchants with the means to cater to the growing consumer demand for flexible and user-friendly payment alternatives. Sipay has secured the most recent version of PCI DSS certification across all its products and solutions. The addition of this, along with BNPL offering, will make the services more compelling among merchants in Spain.

To strengthen their regional presence, European businesses are also entering into merger and acquisition deals. Zopa, for instance, entered into an acquisition agreement with DivideBuy in February 2023. The deal has been announced two weeks after the firm raised US$93 million in a funding round.

Amid the increasing talks of regulating the BNPL market, Zopa revealed that the firm will only offer affordable credit by doing checks and assessments for all of its customers. With DivideBuy, the firm is seeking to further strengthen its position in the fast-growing BNPL market in the United Kingdom, thereby also supporting the sector growth from the short to medium-term perspective.

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