Amidst bank trust deficit.
Pay later solutions are one of the biggest realms of new opportunity for retailers as trust in banks declines and consumer purchasing habits evolve, Openpay executives say.
As retailers confront flat lining sales and Australia’s biggest banks crackdown on credit practices, pay later solutions will become one of the biggest areas of growth for the retail sector, Dion Appel, Chief Revenue Officer at Openpay told a round table on Tuesday.
Appel says that the credit crunch coming from banks in response to the Australian Royal Commission will drive the future success of pay later solutions, with Openpay saving consumers three times what alternative payment solutions like credit cards or loans would.
Avi Schechter, Chairman of Openpay said that this crackdown from banks will ultimately see a number of traditional financial services phased out and replaced by more “agile” financial services like Openpay.
“Regulation will shrink and minimise the bank or more traditional institutions and force them to be as agile as the fintech industry. If I look 10-15 years ahead I see a lot of traditional areas operating today will be filled by companies like us.”
Appel said pay later solutions present a huge opportunity for consumers and retailers in this volatile market. As Australians drown in $45 billion in credit card debt consumers are looking for “better and smarter ways to pay” and ultimately “quantifiable demand” for services like Openpay, Appel said.
These changing consumer expectations are colliding with increased uptake of these services by merchants and creating “a real burgeoning industry,” Appel said.
“It really is a transformational time in payments right now,” he said.
It’s this transformation that has seen “exponential” uptake of Openpay according to Appel, with the company looking to branch internationally after announcing an accelerated roll-out last year.
Schechter also said the company would be making some exciting announcements and expanding in a “Western market bigger than Australia” in the first quarter of 2019.
And with an upcoming Senate Inquiry into payment providers this month, Appel says their company has “nothing to hide,” pointing to ongoing investigations with ASIC finding just four complaints against them in four years.
Appel says the company is “built on transparency” and that their track record can be attributed to their choice to pace their expansion, and will mean they are “well-positioned” for the future, with the upcoming Senate probe.
This article originally appeared on RetailBiz.