Mastercard acquires fintech startup Vyze to offer buy-now, pay-later payment options to customers
Increasingly, consumers are seeking alternative financing options, leaving merchants and financial institutions with a need to deliver these services at the point of sale. In the U.S. alone, these solutions represent a more than $1.8 trillion opportunity, according to Accenture. To tap into this market, credit card giant Mastercard announced it has acquired Vyze, a fintech startup that connects consumers with lenders to finance purchases in installments. The financial terms of the deal weren’t disclosed. Vyze has raised $48.1 million to date.
Vyze is shaking up traditional models by connecting merchants with multiple lenders, allowing them to offer their customers a wide range of credit options online and in-store. These financing options provide shoppers with additional payment flexibility at the exact moment of purchase, complementing Mastercard’s existing card and ACH-based solutions.
With this acquisition, Mastercard becomes a more strategic partner to both lenders and merchants, delivering a checkout experience that adds to Mastercard’s best-in-class security and convenience. Vyze’s proven technology better facilitates lending options to merchants’ customers, delivering a better shopping experience through financing approval rates up to 90 percent that are well above the industry average.
Founded in 2008 by Jim White and Suneet Paul, Vyze is a financial technology leader in consumer financing solutions at point of sale. Vyze helps merchants launch and implement innovative lending programs that provide more consumers with the financing options they want and need. Its simple solutions deliver increased sales and a better consumer financing experience while giving retailers and manufacturers greater control over their lending options. Vyze is used by several top U.S. retailers for special financing options.
“Both consumers and businesses want the best choice and service, exactly when they need it,” said Blake Rosenthal, executive vice president of global acceptance at Mastercard. “Vyze adds to our ability to empower banks and other lending partners to participate in the growing trend of retail financing. The combination of their platform with our technology and network complements our existing payments programs.”
The end-to-end Vyze platform allows lenders and merchants to “integrate once and innovate forever” through the simple use of APIs. Previously, managing and maintaining a range of consumer payment and financing options would require significant time and investment.
“Shoppers looking for new ways to pay and merchants looking to sell higher ticket items and deter abandonments has driven a flurry of activity in the ‘Buy Now, Pay Later’ market,” said Raymond Pucci, director of merchant services practice at Mercator Advisory Group. “This acquisition creates a new market making approach that supports operation at scale, helping banks offer and merchants shop for the terms that best fit their needs. Mastercard’s existing relationships will assure both take a serious look at this new solution.”
Several top U.S. retailers work with Vyze for special financing options. This proven track record will be used to bring the same functionality to customers in additional markets.
“Mastercard has a long history of building an incredibly powerful network, connecting some of the world’s most influential financial institutions, merchants and innovators,” said Keith Nealon, CEO of Vyze. “With their relationships and scale, we see a great opportunity to reach exponentially more partners and consumers.”