Zip Co (ASX:ZIP) is a buy now, pay later (BNPL) financial technology company that was founded in 2013. Zip Co boasts nearly 2 million Australian users, which is approximately 30 per cent of the total market.

Unlike its nearest competitors, Zip Co doesn’t break purchases into four or six instalments, instead consolidating account balances into a single ‘wallet’ and charging a minimum monthly repayment on the total.

Showing resilience amidst the early impact of covid-19, Zip Co highlighted a spate of new partnership agreements and cost-cutting measures which included reducing its full-time workforce by 20 per cent. As a result, the number of transactions from Zip Co actually grew in early April 2020, with the company stating that their monthly revenue was up 86 per cent in comparison to the same period from the previous year.

The company announced the launch of its Zip Business platform in August 2020, giving small and medium-sized enterprise (SME) clients a new pathway to access working capital via a similar BNPL model. It combined the launch with a new distribution partnership with eBay, where the new service will be rolled out to merchants across the eBay marketplace. As part of the deal, Zip Co said it would provide eBay merchants with “access to flexible lines of credit” to help cover short-term expenses such as inventory costs and marketing.

In October 2020, Zip Co announced a partnership with Visa, allowing customers to use their service with any retailer (physical store or online) where Visa is accepted. The service will operate with a virtual card which can also be added to Apple and Google wallets.

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