Zilch, the ad-subsidised payments network, has announced a temporary pause in the rollout of its current customer proposition in the US.
The company, which launched in the US in 2022 after securing a lending licence in California, will shift its focus to the UK while creating an “updated offering for American users”.
Albert Periu, CEO of Zilch USA, who joined Zilch in 2021 after his venture-backed fintech lender, NepFin was acquired by Zilch, will remain working at the company.
A spokesperson for Zilch told The Fintech Times: “Since we launched our beta service in the US, we have gained valuable insights into the market and our customers’ needs. To accommodate these learnings and better align our US and UK services, we are creating an updated offering for American users and, during this time, we are pausing the roll-out of the current customer proposition in the US.
“This decision will also allow us to further consolidate costs, deploy our capital into our exceptionally well-performing UK business in the short term and move more quickly towards our goal of achieving profitability this year.
“These changes will expedite how soon we can begin generating surplus cash flow and, combined with our strong balance sheet, put us in the unique position of being able to fund our future international expansion with little or no reliance on external funding.
“Our US CEO, Albert Periu, will continue to work with the team to leverage our technical systems, licensing infrastructure and partnerships to drive our international expansion strategy.”
Zilch in the US
Zilch launched in the US at a Miami office with over 150,000 pre-registered customers. At the time, Periu and Zilch expected the US market for the company’s services could reach as many as 125 million people and it planned to hire 100 employees in the US within a year.
However, according to fintech advisor Jason Mikula, Zilch recently sent US users an email outlining how it was “changing how things work” and closed all accounts on 29 February.
The emails also said the company would waive the outstanding balances for any BNPL plans users currently have and refund the dollar value of any unused Zilch rewards to users’ bank accounts in the coming weeks.
Earlier this year, Zilch revealed its customer base has increased to more than 3.6 million, sales had surged by 91 per cent and revenue up by 115 per cent. It also improved annual operating losses by more than 65 per cent with plans to hit profitability in 2024.
