ZestMoney, India’s largest and fastest growing Buy Now, Pay Later platform says consumer demand was up by more than 200% in the second phase of lockdown (March-May 21), as compared to the lockdown last year (March to May 2020). Strong consumer behaviour around repayments, bounce rates signalled green shoots of recovery and a revival in consumer demand.
Customer applications for BNPL credit limit on the platform went up by 5X in the March-May 2021 period as more people took to planning their finances better.
E-commerce transactions were up by 200% during this period. In fact, ZestMoney has strategically grown its e-commerce partnerships by 100% on a month-on-month basis, expanding its reach across platforms and brands in fashion, travel and ecommerce.
Categories driving growth included online electronics, smartphones, Edtech, fashion, home decor among others.
Bangalore, New Delhi and Mumbai were the top 3 metros witnessing highest BNPL transactions, while Jaipur, Lucknow and Vishakhapatnam emerged as the top 3 non-metro markets.
Despite the economic challenges arising due to the pandemic, ZestMoney has witnessed that repayment efficiency improved significantly with many customers paying well within their repayment period. The company has witnessed an improvement of 40% in bounce rates, while NPAs were 34% less severe in Phase II, compared to Phase I of the lockdown. NPAs continue to be well below 5% for the company.
Commenting on the trend, Lizzie Chapman, CEO and Co-Founder ZestMoney said “We have seen encouraging signs in the second phase of the lockdown, signalling a strong revival in consumer sentiment. Buy Now Pay Later continues to gain traction as customers look for financing options that allow them to manage their expenses better. Strong repayment behaviour indicates things are improving at a micro level with little impact on jobs and income. Interestingly, Tier II and III markets witnessed stronger revival across parameters. It’s a well-rounded growth across categories from electronics to electric bikes.”
“The overall optimism and strong demand for our BNPL offering gives us confidence to cross $1 BN in GMV run rate this year. We have the largest merchant network of 3,500 online and 45000 offline stores across the country and are doubling down on partnerships. This will help our customers transact at more touch points and categories. We are also adding thousands of new customers every single day, especially from the new to credit segment in non-metro cities who love the convenience of BNPL and online shopping. We continue to remain optimistic and are bullish on the opportunity for BNPL solutions in India”, added Chapman.
To further evaluate the growing trend, ZestMoney conducted a survey with 2800 respondents across the country to understand consumer demand and their preferred financing options.
Some of the findings of the survey were as follows:
- 75% respondents stated that they were able to manage their finances better this year, compared to Phase I
~66% were more optimistic about their job prospects and business this year, compared to last year
~57% stated that their finances were not impacted during Phase II of the lockdown
~62% respondents indicated that they plan to splurge on big ticket items, indicating strong demand and a positive consumer sentiment
Over 53% respondents had opted for BNPL between April to June 2021
Top categories that respondents were likely to spend on in the coming months: Smartphones, electronics, fashion, home décor, water purifiers and air tickets
ZestMoney has 10 million registered users and has built the largest network of merchants with 3,500+ online partners and 45,000+ store partners. The company helps merchants increase the affordability of their products and enables them to facilitate frictionless sales at a higher conversion rate, targeting a larger base of customers.