The FlexiGroup (ASX: FXL) share price is up more than 4% after announcing a Q4 FY20 update for buy now, pay later operator humm.
What is FlexiGroup?
FlexiGroup Limited offers a range of financing options for consumers and businesses through a network of retail and business partners. It has buy now, pay later options called Humm, credit cards and consumer & business leasing. It’s been operating in Australia for more than three decades and serves 1.2 million customers.
Q4 FY20 FlexiGroup update
FlexiGroup announced that in the fourth quarter of FY20 humm saw strong online growth with ecommerce volume up 315% and total transactions up 447% compared to the fourth quarter of FY19.
Some of the new retailers that the company has recently won include Temple & Webster (ASX: TPW), Amart Furniture, Snooze, Bonds, Lego, Cotton On, Typo and luxury brand Bally. Management said that offer of interest free spending from $1 to $30,000 is resonating.
FlexiGroup also announced that humm has made a partnership with Veterinary Growth Partners, which comprises around 170 independent veterinary hospitals.
The company said that the company onboarded a record number of merchants to both instore and online. New online merchants increased by 54%.
FlexiGroup CEO Rebecca James said: “The continued growth in new retailers joining the humm platform, particularly in the health and home categories, shows that our differentiated product offering is compelling to merchants. With the ability to facilitate larger transactions than other buy now pay later providers, humm is continuing to attract a wider range of merchants who previously haven’t offered buy now pay later solutions to their customers.”
Summary
FlexiGroup continues to grow humm well. I’m not sure how big it can become to other buy now, pay later operators like Afterpay (ASX: APT) and Zip (ASX: Z1P), but it has a promising future if it can keep growing like it did this quarter. However, it’s not the type of business I’d normally invest into.
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