FlexPay Applied sciences is a Kenyan fintech out to allow customers to afford merchandise that might have in any other case been out of attain for them.
The startup permits prospects to buy at associate retailers, reserve merchandise and pay over a time frame, at no added price. It initially partnered with a Kenyan retailer throughout launch however scaled in 2020, and has up to now grown its service provider community to 600. This variety of associate retailers is about to develop additional because the startup, which is a part of the 2023 Startup Battlefield 200 cohort, widens its “save now, purchase later” choices.
“We wish FlexPay to be like an energetic checking account in that when a shopper is just not paying for retail merchandise, they’re saving and paying towards a trip, and even faculty charges,” stated FlexPay co-founder and CEO Richard Muchomba, including that the startup is within the means of sealing partnerships that may permit its customers to guide and pay for flight tickets and lodges.
That is a part of its continued technique to retain prospects and follows the introduction of its preliminary product dubbed FlexPay Objectives, for customers with set financial savings ambitions; FlexPay Chama, which permits teams to save lots of collectively; and Mama Prime, for maternity care financial savings.
Its prospects join via the app or its associate retailers (together with offline ones) to start making funds. Web shoppers entry FlexPay as a cost possibility throughout checkout.
“Offline retailers register prospects by way of USSD, and in a manner, store house owners have change into our brokers,” stated Muchomba, who co-founded the startup with Johnson Gituma (COO).
Clients make an preliminary deposit via FlexPay and pay the rest over a predetermined interval.
“We don’t set the variety of installments or particular quantities prospects ought to make, however within the retail trade, most retailers permit funds inside three months. Cost time modifications relying on the trade; for the journey trade, it may be as much as one yr,” he stated, including that its success charge is 96%.
FlexPay will get a 5% fee for each services or products bought via its platform. It claims to have served over 200,000 prospects to this point, a quantity that’s set to develop after its incoming launches in Uganda and Nigeria.
FlexPay’s “save now, purchase later” mannequin is not like the credit-driven purchase now, pay later (BNPL) mannequin that prices curiosity and requires prospects to have a great credit score rating to qualify.
“The rationale persons are shopping for merchandise utilizing FlexPay is as a result of this mannequin has historically been there. We simply digitized it. Individuals can’t afford to purchase high-ticket objects at one off and we predict the pay later mannequin is a greater technique for the African market,” stated Muchomba.
“Behind the scenes, we’re gathering the info we plan to make use of in constructing financing merchandise which can be inexpensive and sustainable.”
FlexPay has to this point raised $785,000, backed by numerous traders, together with the Acacia Group (previously the Cairo Angels Syndicate Fund), LoftyInc, Professional Dojo, Google Black Founders Fund, and Renew Capital.