Ep. 28 Zilch: A Buy Now, Pay Later Model With a Difference - with Philip Belamant, Zilch
May 25, 2021
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Philip Belamant, CEO and Founder of Zilch, challenges the buy now pay later model and discusses Zilch's flexible approach. They explore the advantages of Zilch over rivals, access to credit and liquidity, Zilch's usage in various industries, decision-making framework, the power of selling, and potential regulations on buy now pay later services.
Zilch aims to offer a buy now pay later experience that prioritizes customer value and convenience.
Zilch recognizes the importance of customization and localization for success in different markets.
Zilch employs a comprehensive risk assessment approach based on financial data and customer behavior to minimize defaults and late payments.
Deep dives
Zilch: Revolutionizing Buy Now Pay Later
Zilch is a fintech company that aims to provide a better buy now pay later experience than traditional models. Unlike other players in the industry, Zilch has a direct relationship with customers and allows them to make purchases anywhere that accepts card payments. Their focus is on bringing value to the customer rather than solely benefiting retailers. With a lightweight model and a commitment to customer experience, Zilch aims to expand its reach to 35 countries in the next few years. They prioritize assessing affordability rather than creditworthiness, using a combination of traditional soft credit checks, open banking data, and proprietary risk models. Zilch also places emphasis on building relationships with customers and understanding their usage patterns to inform cross-selling opportunities.
Cultural Differences and Global Outlook
Zilch recognizes the cultural differences in various markets, and they understand that customization and localization are important for success. They have observed that different countries have unique spending habits and customer expectations. Zilch plans to enter the US market after closely monitoring and learning from other buy now pay later companies' experiences. They aim to adapt their product to the needs and preferences of US customers to ensure a seamless consumer experience. While there may be consolidation in the industry, Zilch believes there is room for multiple players to thrive, especially considering the substantial growth potential in the buy now pay later space.
Risk Assessment and Responsible Lending
Zilch employs a comprehensive approach to risk assessment and responsible lending. They take into account factors such as soft credit checks, affordability assessments, and open banking data to assess customers' creditworthiness and ability to repay. They aim to make loan decisions based on customers' day-to-day liquidity and cash flow, focusing on building relationships and understanding their usage patterns. While some companies rely on social parameters or non-financial factors, Zilch's risk policy is primarily based on financial data and customer behavior. By prioritizing responsible lending practices and using data-driven models, Zilch aims to minimize defaults and late payments.
The Value of Buy Now, Pay Later
By now, pay later services like Zilch offer customers an affordable way to manage their cash flow. Unlike credit cards that encourage customers to carry a balance and charge fees, buy now, pay later services focus on responsible and affordable repayment. Customers use these services not because they can't afford a purchase, but to smooth out their payment schedule and manage their monthly or weekly cycles. The key is assessing a customer's ability to afford the payments based on their cash flow, regardless of the size of the purchase.
Zilch's Unique Approach and Benefits
Zilch stands out as a buy now, pay later provider by bringing pre-vetted customers to retailers, ensuring 100% acceptance rates at checkout. The company aims to be a super affiliate platform, driving traffic to retailers and giving customers the money to make purchases. With a fully integrated on-the-channel solution, Zilch provides convenience and ease for both online and offline retail experiences. They also have plans to explore partnerships in travel as COVID restrictions ease. While Zilch focuses on pay-over-time, they aim to curate products complementary to their core offering without becoming a one-stop-shop digital bank.
In the era of fintech giants, neobanks, and modern payment processors, the buy now pay later (BNPL) model has picked up speed in recent years.
While it has been around for some time now, new startups are joining the industry, aiming to offer the next big thing for customers.
Zilch is one such company that helps customers to buy products online with the option to pay later. However, Zilch wants to offer something different to other names in the industry.
In this Disruption Talks interview, we speak with Philip Belamant, CEO and Founder of Zilch, to learn more about why this solution is different. Philip takes us through some of the ways Zilch challenges the buy now pay later model and what the future holds for this space.
Hosted by Filip Sobiecki.
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