LazyPay joins cards bandwagon, targets 1 million customers this year

Pay later platform LazyPay, an arm of Prosus-backed fintech major PayU, has launched a buy now pay later (BNPL) card that can be used at offline stores.

The company, which currently has 3.5 million active users, said that it is looking to have 1 million consumers for its card in the year.

“About 60-65 per cent of our BNPL customers do not have access to credit cards because of reasons like low penetration of banks and insufficient credit bureau scores. But this is not the only target audience for the product. We also have a database of 62 million pre-approved users who can avail a credit line of up to Rs 5 lakh through the product,” Prashanth Ranganathan, chief executive officer (CEO), PayU finance, said.

Ranghanathan also said that the BNPL business is on track to break even in the next few months because of its low non-performing assets (NPAs). “We have two revenue lines – the merchant discount rate and the late fine ­– but we look at them more as a way to prompt customers to pay on time,” he explained.

The BNPL platform said it is on track to grow three-fold in monthly disbursals, to Rs 300 crore in January, on a year-on-year basis. Its aim for the year is to clock Rs 450 crore monthly. The company also plans to provide insurance with its product.

“Given that the revenue stream is not very big, our aim is to offer products like insurance and wealth management to our customers over the next few quarters. While most fintech companies come to credit via payments or neobank products, we started our journey from credit and that is what gives us an edge,” Ranganathan said.

On competition, Ranganathan pointed out that companies like Slice, Uni, Jupiter and others coming up with BNPL cards won’t make much of a difference. “What sets us apart is that we have developed a tried and tested model of offering a credit line to tier-2 and beyond customers – whereas our peers are mainly catering to tier-1 customers who already have a credit card,” he added.