As part of its strategy to become a full-service payment service provider and serve a broader consumer base, the buy now, pay later provider, Sezdle Inc. on Monday announced a partnership with Alliance Data Systems Corp. . to offer Alliance Data’s bread installment loan service to Sezle merchants.
The partnership builds on an agreement Sezzle entered into earlier this year with Ally Financial, the personal loan arm of Ally Bank, to allow Sezzle buyers to use Ally to finance purchases up to $ 40,000, with monthly fixed rate loans of up to 60 months.
The deal with Alliance Data will give Sezzle users a payment option they can use to finance the purchase of expensive items, such as jewelry, furniture and electronics, over a three to 48 month period. at a low interest rate. Interest rates for bread loans start as low as 0% for qualified customers on certain loans.
One advantage of installment loans is that they are better suited for financing large purchases, as consumers pay a predetermined amount of several hundred dollars per month for the life of the loan, compared to $ 50 every two weeks over a period of up to $ 50 per month. go up to three months. , for example. The bread, which was acquired by Alliance Data at the end of 2020, will launch loans through its subsidiary, Comenity Capital Bank.
âBig purchases of several thousand dollars are not suitable for buying now, paying loans later,â says Rob Seidman, vice president of products and long-term solutions for Sezzle. “With Bread, consumers will have a longer period to pay off the loan.”
The addition of Bread is also expected to broaden Sezzle’s appeal to merchants, as Sezzle can now offer another payment option to consumers. âThis partnership allows us to serve a wider range of merchants, especially high-priced merchants, and gives consumers the ability to pay over a longer period than a BNPL loan,â says Seidman. âThe addition of Bread helps complete our product line and positions us to be a full-service payment company. “
Sezzle has over 40,000 merchants in his portfolio.
âWe approach our products and experiences from a consumer perspective, and this alliance is a testament to not only the strength of Bread’s scaled product, but also its modern technology and simple, user-friendly experiences,â said Val Greer, executive vice-president and chief executive officer. commercial for Alliance Data, in a prepared statement. “This agreement allows Bread and Sezzle to expand their reach and generate mutual growth, while giving more merchants the tools to be successful by attracting a variety of customers and basket sizes.”