Openpay to begin 2022 with renewed focus on US market

Openpay to begin 2022 with renewed focus on US market

Encouraged by strong support from key US partners as well as the emerging scale of the opportunity this now presents, Openpay has made a strategic decision to focus on accelerating and supporting the US business as the company’s core growth engine. In parallel, Openpay will accelerate Australia’s pathway to profitability and enter into a partnership agreement with Payment Assist in the UK instead of an outright acquisition.

Openpay’s US opportunity is unparalleled in scale, and their carefully chosen verticals, initially in Healthcare (including Veterinary and Dental) and Automotive, are expected to deliver sustainable growth and value to merchants, customers, and shareholders alike. Their US product suite will differentiate Opy from its more traditional pay-in-four peers while offering merchants and consumers a more cost-effective solution compared to existing US consumer credit providers within their targeted industry verticals.

Commenting on the renewed strategic direction, Non-Executive Chairman Patrick Tuttle said, “This enhanced strategic focus in the US, in addition to bringing forward planned profitability in Australia and entering into a partnership agreement with Payment Assist in the UK market, will ensure the Group’s capital and resources are best focused on those opportunities which the Board believes can deliver the strongest financial returns and long-term commercial success”.

Unique US opportunity

The US market potential for Openpay (branded “Opy” in the US) is unparalleled, as merchants and customers have been longing for a fair, flexible, and transparent payment solution when they need it the most. Opy’s addressable market just in its core verticals is larger by many multiples than the opportunity otherwise presented in other markets. Opy now has all the building blocks in place to monetize this significant and unique opportunity.

The decision to focus the majority of Openpay’s ongoing investment in the US market has been further encouraged by the strong support of their key US partners including American Express, Worldpay from FIS, Goldman Sachs, Cross River, Experian, PatientNow, ezyVet, and Kyriba, among others.

Since launching in October 2021, Opy has signed and begun onboarding dentists, veterinarians, and auto dealers across the US who have enthusiastically signed up to accept OpyPay. In addition, Opy has also recently secured a confidential pilot with a large US healthcare insurance provider (with access to over 50 million customers) that has the potential to rapidly drive scale and value to the Opy business through the responsible funding of payment plans for patient healthcare procedures.

Openpay’s entry into the US has been led by a market-leading team of professionals drawn from the US payments industry, non-bank lenders, Fintechs, and financial regulators, including US CEO Brian Shniderman. Their product is not like the traditional pay-in-four offerings of other US BNPL providers and is designed to accommodate larger, longer-term plans with highly transparent and predictable payment terms for consumers. Opy has US regulatory permission and multi-State credit licensing through the Company’s partnership with Cross River.

Openpay ANZ delivers strongest ever operating performance in Q2 FY22

Openpay’s Australian business has achieved the highest ever quarterly TTV of $87 million, leading to year-to-date TTV of $160 million, an increase of 44% year-on-year (YoY). Record TTV of $35 million in the month of December, generated $2.4 million in Revenue, an increase of 55% YoY on a comparable basis.

The strongest ever ANZ TTV volume delivered market-leading revenue margin of 7.2% and a net transaction margin of 2.9% as at December year-to-date. The Company’s strong margins together with improved productivity support their ambition to deliver profitability in Australia within the next 12-18 months.

To support this strong trading performance, the company is also actively implementing a range of efficiency measures to further accelerate the pathway to profitability in their home market. Further specific details on the group’s recent trading performance will be provided in the company’s Q2 results update to be released on or around 25 January 2022.