Butn makes steady IPO debut and Payright flags record quarter as ASX BNPL sector rebounds

The buy-now-pay-later (BNPL) segment has seen a strong recovery lately.

After languishing at below $130 for much of the year and falling to as low as $85 in May, Afterpay (ASX:APT) has made a rebound, touching $130 last week.

Although it has fallen back to $115 today, the loss-making company has been surging after announcing its BNPL service will be available to a select group of US giant retailers including Amazon, Walgreens, Macy’s, and Nike.

Zip Co (ASX:Z1P) meanwhile, has risen by more than 30 per cent this year after delivering a record quarterly revenue of $114 million, which was up 80 per cent year-on-year.

In today’s trading, new developments from a couple of smaller BNPL players have turned investors’ attention back to the sector.

ASX debutant Butn (ASX:BTN) floated its shares this morning, while another BNPL stock Payright (ASX:PYR) announced a record quarter.

Butn IPO

Butn’s debut saw it become the latest BNPL aspirant to list on the ASX.

But there’s a slight difference – the three-year old company provides financing services to the small business sector instead of directly to consumers.

And in addition to the BNPL offering, Butn also offers other services including advances on receivables, invoices, commissions and business loans.

The company was founded by 38-year-old serial entrepreneur Rael Ross, and 74-year-old former banker Walter Rapoport.

Since inception, it has processed over $600 million worth of funding to small businesses.

Butn raised $20 million in the IPO round at 50c a share for an $80 million market-cap valuation.

Moments after floating, the BTN share price edged higher to 52c.

Payright’s record quarter

Payright announced today that it surpassed guidance in all key metrics during the last quarter.

The company delivered a record gross merchandise value (GMV) of $26.1 million for the quarter, up 134 per cent on the prior year period (pcp).

Total customers were up by 58% on pcp to around 53,400, while total merchants signed up increased by 41% to 3,400.

Highlights from the quarter included the addition of new merchants to the platform — among them Masport, Service Seeking and home improvements company Stratco.

Payright is an emerging player in the BNPL space, and operates within the Australia-New Zealand market.

It targets higher value transactions, with an average transaction size on the Payright’s platform of around $3,000.

Payright says there is a growing need for a BNPL option on larger purchases.

According to its research, 55% of respondents wanted a BNPL option for purchases over $1,000, and 40% wanted a BNPL option for purchases between $2,000-$5,000.