Deferred payment options at the point of sale are taking the world by storm. In Western Europe, Australia, and the USA, consumers are increasingly choosing to shop on a “pay later” basis for purchases in both online and brick-and-mortar shops. The service, which is paid for by retailers, is experiencing rising popularity, offering the division of payments for purchases into several instalments with the customer paying no interest. This category of innovative financial products, known as Buy Now Pay Later (BNPL), has given rise to a number of billion-dollar companies. One of the leading global players has now become an investor in the Czech company Twisto, which has been popularizing BNPL across Central & Eastern Europe for over 7 years. In November, the payment innovator also introduced an interest-free, three-instalment payment option in the region.
“Our long-term goal is to change the European perception of credit and push this towards smarter financing solutions. We want to teach people to take advantage of payment tools the right way, to help them improve their family budgets and better manage their cash flow, especially during the time of COVID,” says founder and CEO Michal Smida, explaining the company’s mission.
The Australian company ZIP, which last year became a unicorn, was founded in 2013 and operates in Australia, New Zealand, the UK, and the USA. ZIP, which is considered one of the world leaders in BNPL, sees Twisto as the emerging BNPL leader in Central and Eastern Europe and has backed them with a significant investment. They were joined in this round by leading fintech fund Elevator Ventures, which is backed by the Austrian Raiffeisen Bank International, as well as several existing investors in Twisto, including Finch Capital, Velocity Capital, ING Bank, and the Austrian insurance conglomerate UNIQA.
“Deferred payment is a path to smart shopping. COVID brought significant tailwinds to the BNPL space as retail sales shifted online and customers sought to better manage their cash flows and shop in a smart way. Consumers have increasingly found that they don’t need to take out loans or accrue expensive credit card debt, but that they can instead spread out their expenses over several months and thus improve their family’s cash flow. We’re glad to welcome new investors who have experience with similar services and see Twisto as a European BNPL champion,” adds Smida.
“Zip is excited to have invested in Twisto, one of continental Europe’s emerging leaders in the BNPL sector. We have been impressed by Twisto’s customer centricity, its productdepth and team, and look forward to collaborating with them to accelerate their growth,” says Larry Diamond Co-founder and Global Chief Executive Officer of ZIP Co.
“We were impressed by the ease of Twisto’s solution for customers to manage daily payments and finances. Their strong traction in Central Europe proves they serve a real customer demand in this region. We are looking forward to supporting Twisto in their ambition to bring their solution to more markets in continental Europe,” adds Maximilian Schausberger, Managing Director of Elevator Ventures.
1.6 million customers in 7 years
Headquartered in the Czech Republic, Twisto is a BNPL specialist that has leveraged regional online shopping trends to introduce and popularize the BNPL payment solution.In a region where cash on delivery (COD) was until recently the most popular form of payment for online goods, Twisto has established itself as the simplest way to pay in e-shops, and has been used by more than 1.6 million customers to date. The Twisto App, the company’s main product, is used by more than 170,000 customers today. The Account is a credit-enabled digital wallet for omnichannel shopping, which includes both a physical and virtual payment card sponsored by MasterCard, mobile payments – Apple Pay and Google Pay, the advanced bill and invoice payment tool Snap, and a payment splitting feature called Split. With Twisto, customers enjoy the full freedom to pay their way for daily shopping with easy 1-tap installments and payment deferral options.
In 2018, the service successfully entered the Polish market, where they now offer thesame range of services. The company is currently exploring expansion opportunitiesacross Continental Europe.
“The global pandemic has caused a sharp customer shift in e-commerce. While cash payments have recently seen a decline in popularity in the region, integrated point of service (POS) financing options have been surging. Twisto’s ease of use and reliability make it a prime candidate for securing a dominant position in the booming European BNPL market, and the COVID pandemic has been a huge catalyst in the shift to deferredpayments,” explains Smida.
Royal Park Partners acted as exclusive financial advisor to Twisto and its shareholdersthroughout the transaction.