The broad shift to mobile and digital payments during the pandemic was a boon for Everyware, an Austin, Texas-based payments firm that launched in 2015 to empower merchants to bill consumers and receive payments via texts.
Now the rise of buy now/pay later lending services is giving Everyware another surge of growth, as more merchants that use text messaging to bill consumers for recurring or large-ticket purchases add BNPL financing options.
BNPL offers sent by text can speed up payments, helping merchants ease tight cash flow in an uncertain economy, because text messages have a perceived urgency. More than half of U.S. consumers read and respond to their texts within five minutes of receiving them, according to a 3,000-consumer
BNPL lending is a natural fit in certain categories in the health care and automotive service fields when the final amount owed isn't known at the time the merchant collects the first payment, said Everyware CEO Larry Talley, who founded the company in 2015.
"Typically a doctor's office using text-based payments will collect the patient's copay on the first visit with a mobile device, which creates a path to send any further bills or other financing options via text," Talley said.
About 2,500 merchants use Everyware's platform to send bills and collect payments, and recently it's begun working with a handful of BNPL loan providers that offer customers a range of installment financing options on larger purchases.
Jaguar Land Rover Frisco, a car dealership in Texas, has added a BNPL financing provided by an undisclosed lender for customers to whom the dealership has sent bills by text, according to Talley.
Some vision and dental services providers and automotive repair companies are also using Everyware's platform to provide BNPL offers by text.
Sunbit, a Los Angeles-based installment loan technology provider that launched its services in 2016, said it's in talks with Everyware about a possible collaboration.
About two months ago, Everyware added
When consumers opt for Visa Installments, the purchase shows up on a separate line on their credit card statement.
Visa's BNPL service has had a positive reception from consumers who like its streamlined process, according to Talley, who says it takes about five minutes for most BNPL providers to qualify customers for installment loans whereas Visa Installments' offers come through faster.
"Consumers responding to a text for bill payment can click on Visa Installments [and] almost immediately see their financing options appear on their device," Talley said, noting that offers typically include 0% loans that must be repaid in equal segments over a series of weeks, along with longer-term loans with interest.
Everyware has also fielded a lot of questions from merchants offering Visa Installments who were unfamiliar with the nuances of Visa's BNPL solution and its policies around risks and chargebacks, according to Talley.
"We're moving slowly through the beta phase, and we anticipate offering Visa Installments more widely soon," Talley said.
The card network is working with new partners such as FIS and Moneris to connect banks, fintechs and merchants on its Visa Installments Solution platform. Its goal is to provide access to a broader spectrum of consumers than these companies can reach in one-off deals, CEO Al Kelly said.
Many of Everyware's customers use text-based billing without BNPL offers. Ravkoo Health, a Tampa, Florida, company that provides health care services through its digital platform, uses Everyware to push billing messages to consumers, Talley said.
Many independent pharmacies use Everyware's platform to prompt consumers to pay for recurring prescriptions via text, according to Talley.
"Offering BNPL loans via text is more suitable for bigger-ticket purchases and we're expecting growth in travel and hospitality, too," he said.
It remains to be seen how big BNPL loans could become within the text-billing arena and whether fraudsters will interfere, but it follows the natural flow of e-commerce trends.
"Paying by text is a logical evolution for the migration of routine information flow from email to text, and it can help merchants increase sales and payments at a relatively low cost," said Thad Peterson, a strategic advisor at Aite-Novarica.
Everyware says its solution protects against fraud by assigning unique cellphone numbers to each participating merchant, and Everyware identifies every payer in real time against the cellphone carriers' records.
The majority of Everyware's revenue come from interchange it collects on card payments when consumers pay by text, Talley said.
Everyware expects to add more streams of revenue from BNPL lenders it connects to borrowers in the next couple of years. Opy USA, a division of Openpay, and Splitit announced plans last year to collaborate with Everyware on BNPL loans by text, but several of these options are still in development, according to Talley.
"We expect to see momentum grow for BNPL-by-text offers in more verticals beyond health care and automotive as demand for BNPL financing gradually expands to more industries," he said.
