As their bad debts spiral, the buy now pay later industry won’t be able to keep resisting credit checks for much longer.
Shares in Minnesota-headquartered buy now, pay later company Sezzle sank to a new low as fresh concerns about regulation and the United States market circled itsZip chairman Diane Smith-Gander. Analysts have questioned if the firm should exit its US business.
Mr Beadle said while Zip is reviewing its capital allocation globally, growing the US would bring more risks in terms of credit quality.“We are concerned that if Zip tries to grow its US business to profitability, this will require taking on more risky customers and add to its credit risk, which may potentially drive even larger losses ,” Mr Beadle said.
are on track, following its “material first half 2022 earnings miss” and the $170 million capital raising that was undertaken in February to help capture cost-savings from the Sezzle merger.
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