Up 1,169% in 1 year, why the IOUpay (ASX:IOU) share price is higher today

The buy now, pay later (BNPL) trend shows little sign of abating.

The IOUpay Ltd (ASX: IOU) share price is on the climb today. Shares are up 1.56% at the time of writing, having earlier posted intraday gains of more than 11%.

This comes after the ASX buy now, pay later (BNPL) company emerged from a part-day trading halt preceding its new partnership announcement.

A couple standing at a counter in a large retail store taking a bag being handed to them by a sales assistant.

Image source: Getty Images

What partnership did IOUpay announce?

The IOUpay share price is on the move after the company reported it has entered into a Master Merchant Agreement with Razer Merchant Services (RMS).

Under the terms of the agreement, the company said RMS is "contracted on a non-exclusive basis to refer and acquire its merchants to onboard and utilise IOUpay's BNPL payment service offering".

All the participating merchants covered under the RMS agreement are in Malaysia. IOUpay will pay RMS a small, fixed percentage for every successful transaction conducted on its BNPL platform from the agreement.

RMS is operated by Razer Fintech, among the biggest O2O (offline to online) digital payment networks in emerging markets. According to the announcement, Razer has processed billions of dollars in total payment value to date.

RMS currently provides credit card, debit card and e-wallet payment options to its merchants. After successful system integration and testing between IOUpay and RMS, BNPL will join RMS' payment options. IOUpay said integration and testing could take up to 4 weeks.

Commenting on the new agreement, IOUpay's CEO Khong Kok Loong said:

We are thrilled to be working together with Razer Merchant Services who represent one of the most progressive networks of online merchants in South East Asia.

Providing our customers with more than 50,000 of Malaysia's most recognised and popular online stores to shop and pay using our BNPL service offerings is an important step in providing our customers with a wide spectrum of choice across brands, products and services.

IOUpay share price snapshot

IOUpay shareholders have been well-rewarded during the past 12 months, with shares up 1,169%. That blows the doors off the 31% gains posted by the All Ordinaries Index (ASX: XAO).

However, the IOUpay share price has fallen hard from the 82 cents per share it reached on 18 February this year, currently trading for 33 cents. But even with that retrace, shares in IOUpay remain up 100% so far in 2021.

Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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