The Splitit Ltd (ASX: SPT) share price is up 11% to 66.5 cents this morning after the buy-now-pay-later start-up revealed it has signed Shopify as a U.S. client.
For anyone not aware, Canadian-founded Shopify is a cloud-based software-as-a-service tech superstar that is cornering the market in offering easy to create online shopping platforms for SMEs to offer shoppers.
Over the past 5 years Shopify stock has gone from US$28 to US$328 on a market value of US$37 billion thanks to it leveraging the rise of SME online commerce.
According to Splitit's announcement the deal means all of Shopify's 800,000 online platform merchants will be able to offer Splitit's buy-now-pay-later option to customers as an integrated payment gateway within minutes of deciding to do so. It goes without saying that Shopify is also growing very strongly with room to add many more merchants over time.
On the surface this looks like great news for Splitit shareholders as its business and gross transaction volume could take off on the back of this one deal.
Others in North America such as Afterpay Touch Group Ltd (ASX: APT) or Sezzle Ltd (ASX: SZL) also likely coveted Shopify as a single customer.
To provide an idea of the potentially transformational scale of the deal for Splitit you can see it had only 509 active merchants as at June 30 2019, but this deal reportedly gives it the opportunity to add another 800,000.
Despite the deal looking material to Splitit, the ASX declined to label the announcement 'price sensitive' so it may still be flying under the radar of small cap punters.
I expect the Splitit share price could get a serious wriggle on over the rest of this week.
