The Splitit Ltd (ASX: SPT) share price has been in fine form on Wednesday.
In early afternoon trade the payments company's shares are up 10% to 54.5 cents.
Why is the Splitit share price charging higher today?
Investors appear to have responded positively to the release of a presentation out of the company this morning.
That presentation looks to have been designed to highlight to investors how Splitit differs to fellow buy now pay later companies such as Afterpay Touch Group Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P).
For those that are not familiar with the company, Splitit provides a business process and technology platform that allows merchants to offer buy now pay later instalments to credit card holders.
This means that consumers can receive an interest free instalment payment option instantly at the point of sale by using their existing credit card limit without further application or approvals.
By doing things this way, both credit checks and underwriting are completed by the card issuer and consumers have upwards of 36 months to pay back the money owed.
This also means that Splitit is not competing with card issuers, processors, and networks such as Visa and MasterCard, but in fact is complementing these services.
So much so, the company believes that Visa's entry into the buy now pay later market will be a big positive for it.
This is because Visa is trialing technology (instalment APIs) that will allow individual card issuers to develop their own instalment plan solution. Management believes that open API's will allow third parties like Splitit to access and build improved customer experiences.
Overall, management feels it is "uniquely positioned to leverage the new technology given it is the only global instalment solution built on the credit cards networks."
Whilst this is very promising, I would suggest investors wait to see if this results in a big improvement in its sales over the next 12 months. After all, at its last update the company reported merchant fees of just $556,000 for the March quarter.
