The best buy-now-pay-later shares like Afterpay Touch Group Ltd (ASX: APT) and Z1P Co. Ltd (ASX: Z1P) just can't stop climbing, but unfortunately another start up rival in Splitit Ltd (ASX: SPT) has been left behind recently.
Splitit shares are actually down 75% from an incredible March 2019 high of $2 to just 50 cents today, but it's not all bad news for early investors with the stock still up 150% from its January 2019 IPO price of 20 cents.
The main operational problem for Splitit has been its lack of progress in signing up fee-paying retail clients with just 509 added over the six months to June 30, 2019.
It also announced on September 19, 2019 that its CEO and co-founder Gil Don would exit the CEO role as at October 1 2019. This has added to the selling pressure.
However, it has a grand plan to put a rocket under its growth rates by offering business-to-business buy-now-pay-later services.
For example a manufacturer of goods or services could offer wholesale buyers of inventory a buy-now-pay-later option by using Splitit.
"Once a buyer and a supplier agree on terms for an order, the buyer can choose Splitit Business Payments instead of a purchase order, making a deposit (often up to a third of the value of a contract) or working through a factor. The seller then puts a hold for the full amount of the order on the buyer's business credit card in lieu of a deposit. Both sides agree to the terms of a monthly installment plan," Splitit revealed.
Whether or not this proves an elixir for Splitit is debatable as inventory is commonly bought off manufactures on credit already as far as I'm aware.
Still Splitit's move shows it's prepared to innovate in an effort to get its share price moving higher again.
I'm not a buyer of Splitit shares myself, but it certainly is an a red hot space right now.
