The Zip (ASX:Z1P) share price is seesawing today on partnership news

The Zip Co Ltd (ASX: Z1P) share price is wobbling today after the BNPL provider announced a new partnership with JB Hi-Fi (ASX: JBH).

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The Zip Co Ltd (ASX: Z1P) share price is up and down today after the buy now, pay later (BNPL) provider announced a new partnership with JB Hi Fi Limited (ASX: JBH).

After reaching an intraday high of $7.56 in early trade, the Zip share price dipped into the red. Shares in the company are now on the rise again, up 0.41% at $7.38 at the time of writing. The JB Hi-Fi share price is trading higher today, up 0.73% at $52.13.

In comparison, the S&P/ASX 200 Index (ASX: XJO) is up 1.69%, while BNPL competitor Afterpay Ltd (ASX: APT) is up 0.59%.

Let's take a closer look at what's during the Zip share price today.

JB Hi-Fi stores to accept Zip payments

 In a statement to the ASX, Zip Co announced it would enter into a partnership with JB Hi-Fi.

This means JB Hi-Fi branded stores and The Good Guys will accept Zip payments from customers, both online and in-store.

Like many BNPL providers, Zip offers consumers the option to pay for items over four interest-free instalments. Consumers are only charged late fees if payments are not made on time.

Merchants, however, are slugged with fees several times higher than standard debit or credit card fees. Merchants are prohibited from passing on the fees to customers, a practice which the Reserve Bank of Australia (RBA) has discussed banning.

Today's news comes just a day after Afterpay launched its latest tool for in-store purchases, Afterpay Card.

The partnership will begin in April 2021.

Management commentary

Commenting on today's announcement, Zip co-founder and COO, Peter Gray:

We are delighted to partner with the JB HI-FI Group. We look forward to providing customers with choice at checkout, empowering them to own the way they pay at JB HI-FI and The Good Guys.

This strategic partnership provides Zip customers with access to even more of Australia's favourite brands, further delivering on Zip's mission to be the first payment choice everywhere and every day

A look at the half-year results

Zip Co

For the 6 months ending 31 December 2020, Zip recorded a 141% increase in total transaction value to $2.32 billion on the prior corresponding period (pcp). Revenue increased by 130% to $160 million on the pcp. The Zip share price fell heavily on the results.

Zip recorded a massive $455.9 million loss for the period.

JB Hi-Fi

During the FY21 half-year, JB Hi-Fi's net profits increased by 86.2% on the pcp to total $317.7 million. Revenue was up by 23.3% for JB Hi-Fi Australia stores ($3.36 billion), 9.1% for JB Hi-Fi New Zealand (NZ $144.9 million), and 9.1% for The Good Guys ($1.45 billion).

Zip share price snapshot

Over 12 months, the Zip share price has increased 369.09%, a very tidy return on investment for traders.

However, since hitting its record high of $14.53 in February, the company's share price has dropped a massive 49.21%.

Zip Co has a market capitalisation of $4.1 billion.

Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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