Splitit Ltd (ASX: SPT) shares have followed the opposite trajectory of Afterpay Ltd (ASX: APT) shares. So, what’s the go with Splitit shares, why is it lagging behind the big players?
SPT share price
APT share price
Splitit to launch its InStore offering
The Splitit InStore offering will enable shoppers to pay in instalments using Splitit for in-person and phone purchases from participating merchants.
The solution integrates Apple Pay and Google Pay.
As a result, users will be able to pay with a Splitit QR code, text message, or email. This is great for consumers, but Splitit’s competitors are doing the same thing.
Chasing market share with the same concept
Splitit enables its customers to break up purchases into monthly interest-free instalments using their existing credit cards. It’s a different solution but uses a similar concept to other buy-now-pay-later (BNPL) players.
The massive spike in the Splitit share price was due to a significant increase in revenue for HY20 but this was off a low base.
Since then, the market’s enthusiasm has tapered off. I can understand this as Splitit provides a relatively similar solution to other BNPL players.
All the BNPL players are fighting for market share by partnering with merchants.
My thoughts
It’s evident that the BNPL space has become really crowded and this is because the barriers to entry are low.
In such an environment, it becomes a volume-based game of whoever can win the most market share. The BNPL players with a first-mover advantage like Afterpay tend to win these fights.
To make things even more challenging, there is an air of inevitability of regulators removing the no-surcharge benefit that BNPL players receive.
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