The Splitit Ltd (ASX: SPT) share price is on watch after revealing a partnership with Middle East BNPL business Tabby.
What’s the new Splitit partnership with Tabby?
Tabby is a leading BNPL provider that operates in the United Arab Emirates (UAE) and Saudi Arabia. It has more than 2,000 merchants which includes Ikea, Marks and Spencer, Adidas and Toys R Us.
In 2020, the e-commerce market in Saudi Arabia was valued at US$11 billion and in the UAE at US$7 billion and is expected to double in size over the next five years.
Splitit has signed a partnership with Tabby where it will integrate Splitit’s instalment payment platform through a white-label product that will allow merchants to offer instalments on credit cards. The integration of Splitit will allow Tabby to expand its offering to new merchant categories, such as those with higher average order values.
The integration to Tabby’s BNPL platform is expected to be completed by the end of the third quarter of 2021.
Management comments
Splitit CEO Brad Paterson said:
“We’ve always seen our solution as complementary to other BNPL providers, which this new exciting partnership with tabby highlights perfectly. Our global payments platform is the only solution leveraging credit card payment networks, with the flexibility to scale internationally without the need for major on-the-ground support.
“Having expanded our platform capability, we can now also offer white label solutions as a way to enter new regions such as the Middle East by partnering with established players that already have a strong market presence. While we remain focused on further penetration of Splitit’s branded product in the US, APAC and Europe, this provides a new low-cost, high-margin revenue stream which we can easily emulate in other markets.”
Summary thoughts on Splitit and the share price
It’s interesting that Splitit is taking a white label approach with its product, which could be quite profitable. The Splitit share price has dropped around 54% over the last six months, so it’s better value than what it was.
I just don’t know how much profit it will be able to make in the future, so I think I’m happy to just watch from the sidelines.
