Openpay share price zooms higher on Woolworths deal

The Openpay Group Ltd (ASX:OPY) share price is zooming higher on Tuesday after announcing a B2B agreement with Woolworths Group Limited (ASX:WOW)…

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The Openpay Group Ltd (ASX: OPY) share price has been a strong performer on Tuesday.

In morning trade the Afterpay Ltd (ASX: APT) rival’s shares are up almost 7% to $1.28.

Why is the Openpay share price zooming higher?

Investors have been buying Openpay’s shares after the buy now pay later provider announced its launch into the business-to-business (B2B) sector.

Openpay has launched into the B2B sector with an inaugural agreement with major Australian retailer, Woolworths Group Limited (ASX: WOW).

Openpay For Business is a Software-as-a-Service (SaaS) solution which allows companies to manage trade accounts end-to-end. This includes applications, credit checks, approvals, and account management in the one system.

The Woolworths agreement.

Under the agreement, Woolworths will roll out the Openpay For Business solution across its payments and digital platform, as part of Woolworths’ business-to-business service.

The retail giant will utilise Openpay’s SaaS business management platform for an initial term of three years, with an option to extend the agreement for a further two years.

However, Woolworths will not be offering a BNPL facility through the platform.

Openpay’s CEO, Michael Eidel, said: “Businesses with trade accounts currently face manual, very time-consuming processes to gain approval for credit checks and manage their accounts. With Openpay For Business, these companies can now seamlessly control the whole trade account process from signing new accounts to invoicing in the one system, saving much needed time and resources and improving trade customers’ experiences.”

“We’re excited to launch Openpay For Business with an Australian business as iconic as Woolworths. This new SaaS product represents an important differentiator for us. It does not require support from Openpay’s balance sheet and is expected to deliver diversified revenue streams for the Company,” he added.

Looking ahead, Openpay intends to build on this agreement by deploying its platform across Australia and globally.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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