Woolworths will launch Openpay for Business to enable firms to manage trade accounts end-to-end – applications, credit checks, approvals and account management – on a single platform. Newly ASX-listed Openpay said in its prospectus that it would develop a B2B payments solution.
The collaboration will shift the buy now, pay later (BNPL) services startup Openpay to become more of a software-as-a-service (SaaS) firm. Woolworths will not move into the BNPL space. BNPL enables customers to spread out repayments for goods and services over time with no interest costs.
Openpay CEO Michael Eidel said that Openpay for Business is intended to speed up business management processes. "Businesses with trade accounts currently face manual, very time-consuming processes to gain approval for credit checks and to manage their accounts," he noted.
Eidel added that with Openpay for Business, corporates can save time and “seamlessly control the whole trade account process” on a single platform.
No costs or revenue expectations were given for the contract, but Eidel said the inaugural contract is an "important differentiator" for the company. The new contract will bring in diversified revenue streams for the company, making it an important milestone in its B2B strategy.
Under the agreement, Woolworths will launch Openpay’s portal across its payments and digital platform as part of Woolworths’ own B2B service. The retailer will use Openpay’s management platform for three years with an option to extend for an additional two years.
Openpay, which started rolling out in the U.K. last year, provides services to customers and merchants in Australia and New Zealand.
Credit unions (CUs) have unique opportunities to elevate their positions with SMBs and the overall financial services ecosystem. According to Biz2Credit, CUs in the U.S. approved nearly 40 percent of small business loan applications in October, compared to a 28 percent approval rate among big banks.