US fintech Upgrade steps in to buy now, pay later arena
Upgrade will let its customers split the cost of their purchase over four months with its new product.
Buy now, pay later is the hot trend in the world of fintech and beyond, and now another fintech is jumping on the bandwagon.
Upgrade, a neobank that offers customers affordable and responsible credit, is launching its own buy now, pay later offering.
Now, Upgrade’s users will be able to split the cost of their transactions and pay off their debt over four months without being charged any interest.
“We are working on a version of the Upgrade Card that’s better suited for smaller expenses. In that case, we don’t need to charge interest because it’s a smaller amount,” Renaud Laplanche, CEO and founder of Upgrade, told CNBC.
“What we like about embedding the product into a card is the broader acceptance. BNPL often relies on partnerships with merchants,” he went on.
The fintech recently closed a $105m Series E funding round back in August, valuing the business at $3.3bn.
Laplanche was both founder and the former CEO of Lending Club but was forced to resign as CEO in May 2016, after an internal review found that $3m in loans had falsified dates and were therefore mis-sold to the investment bank Jefferies.
Laplanche went on to launch Upgrade in 2017. Early investors in Upgrade included Apoletto, Credit Ease, FirstMark Capital, Noah Holdings, Ribbit Capital, Sands Capital Ventures, Silicon Valley Bank, Union Square Ventures, Uprising and Vy Capital.
To date, Upgrade has lent c.$7bn of credit to consumers through cards and loans and says it is on track to deliver a further $7bn in 2021.
Upgrade has been profitable for the last year and founder Laplanche revealed that he is looking to be ready to take his company public in about 18 months.