- Danielle Wightman-Stone |
Afterpay Touch Group, the first digital payments provider allowing people to pay in instalments free of charge on their debit cards, is launching the same service in the UK under the Clearpay brand, following backing from global retail partners including Boohoo and Urban Outfitters.
The payment provider launched four years ago and has partnered with more than 30,000 merchants to offer an interest-free, debit-by-instalment service that has been used by more than 4 million customers in the US, Australia and New Zealand.
The launch of Clearpay in the UK marks the company’s first move into Europe, and they state is an important market as the UK is the third largest global market for e-commerce after China and the US, worth over 70 billion pounds annually. This is more than four times the size of the Australian market, where one in four young people now use Afterpay and the company accounts for 10 percent of all e-commerce.
The UK business will be headed up by ex-PayPal UK chief, Carl Scheible, who joined Afterpay Touch to oversee its expansion across Europe and drive growth.
Scheible said Clearpay’s service is completely unlike existing pay by instalment services, and has proven success reducing returns, stating in a press release: “Retailers across the US and Australia tell us that using this service drives down their returns, typically by around 20 percent, and attracts new customers online.
“This is about putting the customer first and, by virtue of that, facilitating mutually beneficial and higher value connections between retailers and their customers.”
Global retail brands partnering with Afterpay in Australia and the US are already committing to the UK Clearpay service, including Urban Outfitters, Anthropologie and Free People, and Boohoo has added that it will launch Clearpay across all its UK brands and websites, extending its Afterpay partnership in Australia, New Zealand and the US to Europe.
Clearpay also added that it is in “advanced discussion” with a host of other leading UK retail brands. Retailers already using Afterpay in Australia and the US include The Iconic, Asos, Forever 21, Revolve, Kylie Cosmetics and Steve Madden.
Scheible, added: “The Clearpay platform is unlike anything on offer in the UK, offering people greater flexibility to budget and pay for goods and services. By trusting consumers to repay free of charge, it turns accepted wisdom in financial services on its head.
“This is an interest-free way to stagger payments by debit, which rewards positive behaviour and is the opposite of a traditional credit product. Instead of making money by trapping people in accruing debt, Clearpay charges retailers a fee to provide the service and covers the cost of the purchase up front, removing the risk for the retailer.”