Australian unicorn BNPL Zip seeks to exit UK market
Australian buy-it-now, pay-later (BNPL) company Zip Co is looking to sell or close its UK business, according to reports.
The Sydney-listed unicorn only recently became active in the UK market. However, Sky News reports the company is seeking buyers for its UK business.
It is not yet known whether it will shut down its UK operations altogether if no buyer can be found.
When approached by UKTN, the company declined to comment on the future of its UK operations.
It comes just days after Zip Co made the decision to pull out of an attempted takeover of BNPL’s US rival Sezzle. Until this week, Zip Co had insisted the deal was on track.
Zip Co has a presence in a number of international territories including (for now): UK, Saudi Arabia, Mexico and India.
There have been clear signs of trouble in the once thriving fintech industry, with the BNPL sector, in particular, feeling the pinch of the current market downturn.
Klarna, one of the largest providers of BNPL services, recently lowered its valuation by nearly $40 billion in its latest funding round.
BNPL companies have started to face fierce competition from big companies like Apple that are expanding into the sector. Already established fintechs, such as Revolut and Zopa, have also recently entered the increasingly crowded market.
There are also regulatory tensions in the UK over the BNPL industry, as the country approaches much stricter requirements for the service.
The government’s announcement followed multiple warnings and concerns that BNPL was more prone to consumer risks than previously thought.