Compass, the consumer credit arm of Italian investment banking group Mediobanca, has snapped up two firms in the buy now, pay later (BNPL) segment in order to its growth in the deferred payment business.
It has acquired a 19.5 per cent stake in HeidiPay, a fintech company based in Switzerland, and specialised in the development of digital platforms to support BNPL in the e-commerce segment. In addition, it has also acquired 100 per cent of Soisy, an Italian fintech.
The two deals are designed to help Compass pursue its growth strategy in the BNPL segment. Expansion and diversification of the client base will also enable the company to cross-sell Compass products to a younger target clientele more likely to make purchases online.
The HeidiPay transaction will also enable Compass to spread its wings geographically with international as well as national coverage.
Alberto Nagel, CEO of Mediobanca, said: “The synergies we will generate from our acquisition of these two companies will give us access to new expertise and next generation technology assets, an important value option in a segment such as deferred payments which is changing at such a fast pace. Leveraging these acquisitions will also act as a driver to obtain new clients, not just in Italy but also elsewhere.
“Buy now pay later is now an established trend”, added Gian Luca Sichel, Compass CEO. “Compass is so far the only bank in Italy to seize the opportunities offered by this business and create its own interest-free deferred payment solution with PagoLight: it’s a business which dovetails perfectly with consumer credit, innovative and with excellent potential to support growth.
“BNPL also allows a bank such as Compass to strengthen our presence in e-commerce, with a focus on certain categories of products and targets in particular, such as younger and digitally-literate clients, which historically have received less coverage from consumer credit.”
According to Compass, its capability to acquire new clients through BNPL is expected to rise fourfold by the end of FY 2022-23 (from 5,000 to 20,000 new clients per month).