Category: News

• In recent testing, Zilch Up has already helped over 25,000 people switch from being invisible to visible at the UK’s major credit reference agencies
• Zilch – already regulated by the FCA – has rolled out this new offering off the back of securing further licence enabling it to show customers their credit scores, bringing a pioneering shift for the BNPL payments sector   

Zilch, the UK-headquartered multi award-winning ad-subsidised payments network, today proudly unveils Zilch Up – a revolutionary product dedicated to empowering people typically excluded from mainstream credit. This will create access for millions to build their financial profiles safely and responsibly and without paying any interest. 

The introduction of Zilch Up provides all the benefits of Zilch’s zero-interest, ad-subsidised borrowing with the ability to improve your credit score, which wasn’t possible before Zilch. With 5 million people in the UK deemed credit invisible, Zilch’s new product enables customers with tools to improve their credit scores and increase their credit limit. Starting with credit limits as little as £50, Zilch Up has all of the same powerful features as the Zilch classic product with a few important changes designed to be suitable for its target user.

Zilch Up customers have the option to pause credit and still use Zilch as a debit card via the Pay Now option, and earn rewards. Or with total control they can toggle in-app to Credit and pay a first instalment of 50%, with the remaining 50% payable over six weeks. In addition, customers will soon also be able to receive financial support in the form of credit coaching, and the ability to view their credit score in the Zilch app. 

Zilch’s innovative approach gives customers a regulated offering which, in partnership with leading CRAs, means that for the first time, consumers can improve their credit scores by spending on interest free credit via BNPL borrowing and enjoy all of the consumer protections they would expect from a regulated product.

Philip Belamant, CEO and co-founder of Zilch, said: “We need to strengthen the protections for consumers and increase access to interest free and affordable credit – particularly now when the cost of living continues to hurt. For too long millions of people in the UK have had to struggle with limited or no access to credit due to thin and weak files. In a digital finance world, this is causing them the stress and crippling pain of funding unaffordable high interest costs plus the danger of hard to understand late fees, merely to access credit. 

“At Zilch, we aren’t waiting. We want to change this status quo by democratising access to interest free and affordable credit, advancing the lives of millions of families and individuals in managing and planning their day-to-day financial health. In testing, our new product, Zilch Up, has already lifted over 25,000  customers into mainstream credit and we intend to help many more.”

Zilch Up not only reflects Zilch’s commitment to financial inclusivity but also signifies a bold step towards creating a fairer, more inclusive financial ecosystem that brings all the benefits of ad subsidised zero interest payments to customers who would otherwise miss out.

The results mean thousands more people now have enough detail in their credit records to be deemed to have a valid credit history. A credit score improvement can only occur where a consumer is more up to date with Zilch than they are generally with other lenders, or where there was no history and they have borrowed from lenders not reporting their history (which traditionally would be extremely high-cost marginal lenders)

Zilch’s journey began with a profound recognition of the disparity in affordable credit access, between those in society who need it most, and those who have access to the most affordable financial products. This has inspired the business to embark on a mission to bridge this critical gap. Through strategic partnerships with the UK’s leading credit referencing agencies (CRAs) Zilch has honed the Zllch Up initiative that serves as a testament to its commitment to financial inclusivity. 

Zilch is the only UK provider of credit via BNPL whose data appears on consumer credit files and is always included in scores.

Zilch was the first UK-born BNPL provider of credit to be authorised by the FCA, giving its customers extra protections and making sure they can access the Financial Ombudsman Service.

Contacts 

Zilch – Ryan Mendy, Chief Communications Officer: [email protected]  

• In 3 years, Zilch has generated a total of £300m in rewards and savings for users.

• Company reveals customer numbers reach 3.5m, equivalent to 3,000 sign-ups a day since launch.

London, 31 August 2023 – Zilch – the multi-award-winning ad-subsidised payments platform – is to open markets for trading at the London Stock Exchange today to celebrate its third birthday. The milestone celebration coincides with a series of achievements including remarkable customer savings and growth, robust trading performance and a string of industry awards that underscore the first phase of its vision to eliminate the cost of consumer credit. For good.

Today, Europe’s fastest fintech to go from Series A to $2bn valuation – Zilch – reveals it has passed the threshold of 3.5 million registered customers – the equivalent of over 3,000 people signing up to benefit from Zilch every day, for three years since its launch. By using its reward-earning ‘Pay Now’ debit product and zero-interest ‘Pay in 4 over 6 weeks’ credit product, Zilch customers have now spent more than £1.5 billion through the platform and in return benefitted from over £300 million in rewards and savings on interest and late fees.

Having consistently maintained one of the highest Trustpilot ratings of any financial product, Zilch is today one of the most respected and valuable of the 20 UK fintech unicorns.

Philip Belamant, CEO and co-founder, comments: “I’m enormously proud of how far we’ve come in just three years, and we appreciate Julia Hoggett, CEO of the London Stock Exchange, inviting us down to open its markets today in celebration of this milestone. In just 36 months, almost 10% of the UK adult working population is now a registered customer. Many customers are using Zilch daily with our average customer using the product 100 times a year. Zilch has already driven over £1.5 billion in commerce to retailers and put over £300m of savings and rewards back into the pockets of customers. And this is just the beginning.

“Whilst we remain acutely aware of the many challenges that lie ahead, I am very encouraged by the fact our margins are currently at their highest, credit losses at record lows and revenues the strongest we’ve ever seen. Exceptional growth in fundamental unit economics with substantial gross profit margins holds Zilch on a clear course to profitability and beyond. We are also currently on track to process more sales in the next 12 months than we have in Zilch’s history to date.”

Sean O’Connor, co-founder, added: “We are pleased that the strength with which our counter-cyclical business model has performed during this challenging macro market environment, together with the scale of its societal impact and growth potential, is increasingly being noted in institutional capital markets. As such, we are delighted to be invited by the CEO of the London Stock Exchange to open what is one of the world’s major stock markets.”

Zilch was invited to open markets at the London Stock Exchange in celebration of its three-year anniversary. Still a privately owned, fast-scaling business, Zilch is using its unique ad-subsidised payments model to tackle one of the world’s largest Total Addressable Markets (TAM), wherein circa $50 trillion (up from circa $20 trillion in 2000) is being spent on bills, payments and ecommerce annually. In the next five years, this is expected to grow another $30 trillion.

Zilch has received a slew of prestigious awards validating its industry-leading position, including being named ‘Best Credit Card’ at the 2023 Global Payments Innovation Awards and ‘Alternative Consumer Credit Provider of the Year’ at the esteemed Credit Strategy Awards (following on from its recognition as the ‘Best Credit Card’ at the 2022 Credit Strategy Lending Awards). In addition, Zilch’s co-founder and CEO was recognised as ‘Leader of the Year 2023’ at Credit Strategy’s recent Leadership Awards, and EY’s Entrepreneur of the Year 2022 for London.

ENDS

About Zilch

Zilch’s vision is to eliminate the cost of consumer credit. For good.

Zilch is a multi award-winning direct-to-consumer ad-subsidised payments network. Leveraging its unique vertically integrated, first party data business model to set itself apart from the incumbent fintech industry with a profitable global revenue source, bringing unrivalled value to customers and marketers alike. Today Zilch is revolutionising the $50 trillion advertising and payments industries by merging the very best of debit, credit, and savings.

Zilch provides millions of customers the freedom to go anywhere in the world (online or offline) and when they pay, earn up to 5% cashback & rewards on debit payments (‘Pay Now’) or spread interest-free credit repayments over six weeks (‘Pay in 4 over 6 weeks’) and in the process help build their credit profiles with the major credit agencies. Within 36 months since launch in 2020, Zilch amassed more than 3.5 million registered customers.

With the launch of its proprietary Ad-Subsidised-Payments Network (ASPN), Zilch allows retailers worldwide instant connection with millions of Zilch’s first-party data, closed loop network of high intent customers. Offering customers personalised savings, deals and discounts codified to their habitual spend.

In January 2023, Zilch struck a ground-breaking reporting agreement with the UK’s prime credit reference agencies, transforming the UK lending ecosystem by enabling 50m+ adults to build their credit records using interest-free credit rather than high-cost revolving credit products.

Since April 2020, Zilch has been regulated by the Financial Conduct Authority (FCA), obtaining a consumer credit licence through the Regulatory Sandbox Programme.

For more information, visit: www.zilch.com

Contacts
Zilch – Ryan Mendy, Chief Communications Officer: [email protected]

For any media enquiries, please contact:
[email protected]

Zilch, the groundbreaking direct-to-consumer (D2C) credit provider and advertising technology platform, announces the opening of its new technology hub in Krakow, Poland. This strategic move establishes a European Centre for Excellence which will serve as a pivotal facility dedicated to accelerating the development and implementation of new innovative features and technologies.

The Krakow hub marks Zilch’s third global location, complementing the company’s London headquarters in the UK and its Miami office in the US. With over 30% of Zilch’s software engineers based in Krakow, the technology hub is poised for further expansion over the next two years. This growth will leverage Poland’s thriving economy, its renowned business services sector, and a local labour market boasting a vast pool of highly skilled technology specialists.

Under the leadership of Zilch’s CTO, Sean Hederman, the Krakow team will collaborate closely with the core engineering centre in the UK, setting the stage for the establishment of additional technology hubs worldwide to sustain Zilch’s continued growth trajectory.

This investment in Zilch’s core product development capabilities aligns seamlessly with the company’s strategic focus, which has propelled Zilch to over 3 million registered customers in record time.

Philip Belamant, CEO and Co-Founder of Zilch, stated, “The current global macroeconomic climate has led to a marked increase in financial exclusion for customers and a significant reduction in funding for private firms. This creates an environment where well-funded, economically viable and highly scalable companies like Zilch can leapfrog the competition while delivering immense value to the mass market customer. While others are scaling back, we are doubling down on investment into our team, product, and customers. This strategic step is part of our targeted investment program into R&D and technology. We expect our new Krakow operation will serve as a blueprint for similar technology hubs worldwide.”

~ ASPN, Zilch’s proprietary ad-sales platform, achieves conversion rates of up to 55%, surpassing the search industry average by 10+ times – enabling the Googlisation of Payments ~

~ The Ad-Subsidised-Payments-Network allows retailers to offer contextualised advertising deals directly to customers through its vertically integrated payments app

~ Platform brands such as Amazon and Ebay achieve average conversions of 59% ~

~ Food & Drink sector witnessed particularly outstanding results, with brands achieving an average conversion rate of c.70% ~

~ Significantly reduced product return rates across all sectors, averaging just 7% compared to the typical ecommerce range of 20-30% ~

Zilch, the pioneering direct-to-consumer (D2C) payments technology and advertising platform, is today announcing the official rollout of its Ad-Subsidised-Payments-Network (ASPN) to third parties through open APIs. The proprietary ad-sales platform has demonstrated unprecedented performance, delivering outstanding results for retailer partners and, more importantly, providing customers with over $160 million in savings via cashback, rewards and interest-free credit.

Zilch initially created ASPN to power its own ad-subsidised Buy Now Pay Later (BNPL) product offering, attracting over 3 million registered customers in just 24 months and seeing more than 5,000 retailers reallocate their advertising spend away from clicks and impressions to a payments platform that only charges for sales. With more than $1.7 billion in commerce having been transacted through the platform, ASPN is now being made available through open APIs to any third-party app / card issuer that wants to participate in the network, which is already integrated with 38 million merchants worldwide. Partners can access the network of dynamic commissions through APIs which provide new revenue streams outside of interchange. Merchants can adjust these commissions and attribute sales (online and offline) in real time without any change to their existing payment infrastructure. 

The democratisation of access to Zilch’s ASPN will create new business-to-business revenue for the firm and substantial additional revenue opportunities for partners, all while accelerating Zilch’s mission: to eliminate the cost of consumer credit (using ad subsidies), for good.

The unparalleled performance of Zilch’s ASPN platform demonstrates the power of retail media, helping Zilch become a game-changer in today’s fintech industry. An analysis of the data from ASPN’s performance shows:

• Brands can achieve a conversion rate (the proportion of customers who make a purchase after interacting with the advert) of up to 55% – significantly higher than the industry averages for traditional forms of digital advertising that range from c.2% to 10%.

• Food and drink brands are converting at an average of c.70% of ad interactions into sales. Brands such as Amazon achieve average conversions of nearly 60%.

• Retailers also saw product return rates plummet, averaging 7% across all sectors compared to the average e-commerce range of 20-30%. This shows how Zilch helps retailers reach customers with a genuine intent to buy rather than stoking impulse purchases, which is hugely beneficial to both the retailer and the consumer (not to mention the environment too).

1. Zilch’s current top 30 merchant partners alone generate a combined $700 billion of revenue annually and pay an average commission to Zilch of over 6% on each purchase made via the Zilch platform. That speaks to the commercial opportunity for Zilch and its new retail partners as well as the scalability of this unique business model.
   

Philip Belamant, CEO and Co-Founder of Zilch, said: “Our vision with Zilch was to offer all customers an incredible payments product that would eliminate the cost of consumer credit for good. To achieve this, we generate ad revenue from merchants when customers shop and use this to subsidise  our powerful reward-earning debit and zero-interest credit in one digital card that customers can use anywhere. This is what we call the Googlisation of Payments. Uniquely, merchants can redirect ad spend to Zilch away from clicks and impressions on traditional platforms that suffer fraud, lack of attribution and don’t necessarily convert into sales.

“Opening up ASPN to third parties is an important step in creating what could be a trillion-dollar-plus payments ad-marketplace. On one side you will have millions of consumers transacting billions every month and receiving access to interest-free-credit, savings and rewards on their purchases. On the other, you’ll have hundreds of thousands of retailers bidding to get in front of a massive closed-loop network of ultra-high-intent consumers with a sustainable means to spend.

“We truly believe that this is the future of the advertising industry, and that our current results, across almost $2 billion of commerce to date, bear evidence to that. The market continues to see a decline in spend on search and social media advertising in favour of retail media, where retailers sell online ads using their first-party data, precisely because retail media provides advertisers with better targeting at times of maximum ‘intent’, higher conversion and more accurate attribution. What data from ASPN shows is that, when you place those ads on a consumer’s favourite payments platform and enable them to make the purchase, rather than on the checkout page of an ecommerce site, the performance is unparalleled.” 

Click here to register for our white paper, coming soon.

Introducing Zilch and the UK’s leading debt charity, StepChange’s, debut public appearance at Innovate Finance’s Global Summit (IFGS) 2023. Our Chief Communications Officer, Ryan Mendy, and StepChange’s Director of Client Experience, Gail Arkle, were joined by Innovate Finance’s co-founder, Justin Fitzpatrick, to discuss how our innovative solutions are helping vulnerable consumers manage their finances during difficult times.

Watch the fireside to discover the importance of how market-first partnerships like Zilch and StepChange are creating a more financially inclusive society.

Zilch’s vision is to eliminate the cost of credit for consumers. For good.

Time’s up for lobbyists trying to slim down progressive new rules for Buy-Now-Pay-Later (BNPL). Last night, a consultation by HM Treasury on new regulations for BNPL lending came to a close. Whatever happens, ministers must keep momentum and not water down the legislation.  

It’s vital that the government does everything it can to make sure consumers are properly protected. Vital because we are seeing the largest change in how people pay in decades and because, until now, too many lenders have done their business, lending billions in credit to the public, without the high standards, accountability and consumer protections expected of regulated firms.

BNPL services have become so integral to how consumers spend that BNPL accounted for almost one pound in every eight spent online this January. Like consumers’ habits, the British economy has changed. Inflation is down slightly, but cost-of-living pressures remain intense. For some, access to interest-free, affordable credit is the only way to manage spending from month to month. Why would you opt for an interest-bearing revolving line in its place?

Rising demand for 0%-interest credit has led to a growing number of fintech companies offering these services. In a mark of validation, many high-street banks have entered this new space too and more recently, Apple. Yet, until now, regulation has been busy playing catch up.

In fact, the majority of firms have been operating solely under an exemption to the UK’s existing consumer credit regulations. That has meant unregulated BNPL businesses have operated without accountability, while processing short-term loans running into the billions. This left consumers without a right of appeal or redress if things went wrong.  

Thankfully, that situation is about to change. In February, the UK Government set out proposals to tighten regulation of the BNPL sector, clamping down on unregulated providers. To date, most firms have paid lip service to the idea of greater oversight and control without taking action. Now, the customer safeguards they could – and should – have introduced voluntarily will become mandatory.  

We support the government’s plans – and would go further still. There are two areas where we believe the incoming regulations should be tightened for the whole credit industry, not only the BNPL sector.

The first relates to what is called ‘credit stacking’. This is where customers are allowed to pay off one debt with another form of debt, such as using a high-interest-bearing credit card to pay off an interest-free instalment plan with a BNPL provider. All this does is shift the debt around, often moving it to a card carrying a significantly higher interest rate than would be imposed by an interest-free BNPL agreement. The BNPL provider is handing off the risk to the credit card company and the customer is being “refinanced” out of a zero-interest loan into an interest bearing one.

This short-sighted practice should be banned outright. It allows the new providers to underprice risk and offload defaults to credit card companies, leaving them with higher bad debt losses, and transforms interest-free credit into revolving interest-bearing credit for customers. This all perpetuates problem debt.

The second area relates to how customers’ borrowing and performance is communicated to credit reference agencies (CRAs). The government would like BNPL providers to report to these organisations, which until recently haven’t been ready for accurate reporting on the sector. Fortunately, as of this year the major UK agencies are ready and so all credit lenders, inclusive of BNPL, should now share data with all prime CRAs – as Zilch already does.

In short, it is our belief that all credit lenders – BNPL or otherwise – should report to all credit referencing agencies, and this should be reflected in consumers’ scores today. Doing this would offer the highest form protection to consumers.

When that’s done correctly the ecosystem will surely begin to sing. It will allow all lenders full visibility of individuals’ outstanding debt and repayments, helping lenders to better assess affordability, further protecting customers from over-borrowing. So far many BNPL firms have been unwilling to report at all, or to all three major credit reference agencies. Of those that do, most don’t do so in a way that 1) ensures repayment performance is reported every month, and 2) influences their customers’ credit scores. This is something we at Zilch already announced in January 2023.

If properly operated by responsible, regulated companies, BNPL can deliver real benefits. We’re not reinventing the wheel but rather making the wheel more accessible, affordable and easier to understand (most today don’t even know what APR stands for). These services are significantly more affordable than how we all used to borrow money for short periods – those expensive credit cards or online loans, for which the average APR is now over 30%.

With 5 million UK consumers deemed ‘credit invisible’, we need an industry standard for credit reference agency reporting that incentivises and rewards responsible spending, while making sure that BNPL providers conduct appropriate affordability checks on borrowers and help other lenders do the same.  

History has taught us technology always arrives before regulation. The UK can safeguard people and build a system of regulation that serves as a blueprint for regulators and governments globally. It seems that we are well on our way to doing just that.

Watch Philip Belamant, CEO & Co-Founder of Zilch, sit down with Simon Squibb, investor, entrepreneur and Chief Purpose Officer at The Purposeful Project, as they delve into the mind of the visionary entrepreneur, as Zilch continues in it’s mission to revolutionise the way we think about and interact with finance.

Zilch has become the fastest European fintech company to go from Series A to $2bn valuation, and in this episode, Simon and Philip go deep into the core values and mission that enabled Zilch to reach this huge level of success so quickly.

Watch the full interview here or see the links below to the Spotify and Apple Podcasts.

Podcast links:

Open banking platform Yapily and payments technology company Zilch have agreed a groundbreaking partnership that will provide millions of people with better access to 0% interest swift repayment credit. 

The partnership marks the first time Yapily has teamed up with a provider of consumer credit via Buy Now Pay Later (BNPL) and will see Zilch leverage Yapily’s innovative open banking platform and expertise to deliver an even more accelerated and superior credit decisioning process, responsibly, at a time when it is most needed in the lending industry.

Recent research from Yapily, which surveyed 2,000 full time professionals in the UK, found 59% of people have used credit cards to supplement their income over the past 12 months. Meanwhile, 34% have used overdrafts, 21% have turned towards personal loans, and 9% have taken out payday loans. 

The interest rates, fees, and charges associated with high-cost or short-term credit options are leaving vulnerable individuals in negative debt cycles. The study also revealed that those earning £15,000 or less were the highest users of personal loans over the past 12 months – with 26% of respondents in that salary bracket having used them. With the cost of living a significant concern for 95% of those polled, there is a growing need for affordable and accessible credit solutions. Data from Zilch’s own research shows that interest on credit cards alone is costing the British public an estimated £15 billion a year. Broken down that works out to be £41 million a day.

Furthermore, figures released by The Money Charity recently reveal that credit card balances have increased by half a billion pounds per month over the last 12 months in the UK, rising from £55 billion in January 2022 to almost £64 billion in January 2023.

By partnering together, Yapily will enable Zilch to access an individual’s risk and affordability profile more accurately than is currently exercised by traditional assessments. This makes it easier to provide Zilch’s 3 million customers with credit options that are tailored to their specific financial situation. This approach will empower individuals to manage their finances better.

Philip Belamant, CEO and Co-Founder of Zilch, commented: “I believe we are probably at the early stage of seeing the greatest consumer shift in payments in a quarter century –  since PayPal was founded. In the context of the cost of living crisis, it’s never been more critical for people to have access to 0% interest responsible credit when managing cashflow. That’s what this new partnership with Yapily embraces – helping Zilch to achieve by maximising the consumer benefits of open banking technology. The traditional consumer credit scoring systems have prevented smarter decisioning with ultimately credit-worthy borrowers. Blocking consumers from timely accessing both prime and affordable finance. Creating a trap for the most vulnerable in society. With Yapily and open banking, we are able to advance how we provide our millions of British customers all the trust, protections and benefits they ordinarily expect from traditional high street banks, but avoid all the costs.”

Stefano Vaccino, CEO and Founder of Yapily, added: “Over five million people in the UK have little to no credit history, greatly reducing their access to mainstream financial services. In times like these, it’s important that everyone has access to the credit they need, when they need it most. But critically, this must be based on what they can actually afford at risk of falling on even harder times. It’s great to see more lenders like Zilch turn to open banking to meet the needs of individual borrowers. I look forward to watching our partnership grow and enabling Zilch to deliver fairer credit to millions of people now and in the future.”

The announcement follows the news that providers of credit via BNPL (Buy Now Pay Later) will now be regulated by the Financial Conduct Authority (FCA). This move is welcomed by Zilch, which has been regulated by the FCA since April 2020, before the organisation launched in September later the same year. 

In January of this year, the company announced it would be sharing information with all prime UK Credit Referencing Agencies (CRAs) in a deal that will see customers be able to build and influence their credit scores.
Zilch also recently announced a collaboration with leading UK debt charity StepChange to become the first provider of credit via buy now pay later to fully integrate StepChange Direct into its platform. The partnership will see Zilch provide innovation that will better advance the user experience and help customers at what is usually a vulnerable time by creating a smoother and quicker process when being referred for support.

London, 7 February 2023: Zilch, the UK-headquartered payments technology company, today announces it has signed an industry-first partnership to work with StepChange, the UK’s leading debt advice charity, which will help Zilch’s millions of customers access help, should they need it, more quickly during the current cost of living crisis. 

This support for StepChange will see Zilch become the first provider of credit via buy now pay later to fully integrate StepChange Direct into its platform. The payments technology company will also go one step further and provide innovation that will better advance the user experience. 

To help customers at what is usually a vulnerable time, Zilch and StepChange have worked together to identify a number of steps that are currently required when they are in financial stress and are referred for support that can be removed. StepChange’s immensely talented team will also work with the Zilch vulnerability team on how to recognise and make referrals to debt advice more effectively. 

Zilch will be making financial contributions to StepChange through the Fair Share funding mechanism, supporting the charity in its operations and ensuring that UK consumers continue to benefit from easy access to an independent charity committed to helping people in financial difficulty become debt-free.

Working with StepChange comes off the back of Zilch more recently becoming the first provider of its kind to report customer behaviour to all major UK Credit Reference Agencies (CRAs).

To date Zilch has provided its customers with over £95 million in aggregate savings as it charges zero interest for instalment loans and offers cashback and deals of up to 10% back when paying by debit. Zilch was one of the first companies in the space to be regulated by the FCA and sets dynamic, personalised affordability limits on customers’ total borrowing to make every transaction affordable. Through this support for StepChange, Zilch customers can be immediately and seamlessly referred for free high-quality independent advice, provided through StepChange’s omni-channel debt advice service, whenever needed (at which point further Zilch credit is also temporarily suspended).

Today’s announcement is Zilch’s latest industry-leading innovation to promote financial inclusion and help protect consumers from problem debt. Last month Zilch announced that it had reached a ground-breaking deal with the most reputable UK CRAs that will see its customers’ borrowing and repayment activity using Zilch credit begin influencing their credit scores and profiles for the first time. This innovation provides millions of British consumers the opportunity to build and improve their credit scores without making use of high-cost, revolving credit products. It will also boost consumer protections and financial health throughout the wider UK consumer credit ecosystem by giving other lenders visibility of Zilch users’ current and historic borrowing activity.

Philip Belamant, CEO and co-founder of Zilch, said: “The entire ethos of Zilch is about being customer-first and we’ve built the business around doing the right thing by our customers – even if it’s difficult – every time. It’s why we’ve invested so much time and resource into building a meaningfully proactive relationship with StepChange. To Zilch, this partnership is a natural and obvious one – why would any responsible lender of credit not want to align with an establishment such as StepChange that is doing so much to support people in these hard times?

“This partnership ensures we provide our customers with the very best support if they do fall behind on repayments – all for free.”

Phil Andrew, CEO of StepChange, said: “StepChange has been helping people for 30 years – and during that time has supported millions of people seeking help with problem debt.

“Over the last three decades a lot has changed – with new challenges like the cost-of-living crisis and new financial products.

“But one thing has not changed and that is our commitment to support people struggling with problem debt and to work with a wide network of partners and supporters to ensure that those who need help can access it. 

“Zilch’s commitment to our work through the payment of Fair Share contributions, as well as finding innovative ways to minimise the barriers to people seeking help, will support us at StepChange to continue our important mission.”

ABOUT ZILCH 

Zilch is a UK-headquartered payments technology company. We offer our customers the best and most empowering way to pay, whenever and wherever they spend. Using Zilch’s virtual Mastercard that combines the best of debit, credit and savings, our customers can either earn rewards on debit payments in the form of immediate cashback (‘Pay in 1’) or spread the cost by in-app toggling over to pay with credit to access interest-free repayments over six weeks (‘Pay in 4’). This is made possible by the proprietary Ad-Subsidised Payment Network (ASPN) that Zilch has built, which in a cookieless world enables retailers around the world to connect directly with the millions of Zilch customers they otherwise couldn’t reach and offer them savings, deals and discounts. 

By partnering directly with consumers rather than merchants, Zilch allows customers to pay using either reward-earning debit or interest-free credit, both online and in-store, anywhere that Mastercard is accepted. To ensure that we are helping our customers to manage their cash flow responsibly when they make credit payments, we set dynamic borrowing limits using best-in-market data from credit reference agencies, open banking and behavioural data analysis. Together these generate a real-time, comprehensive, 360-degree view of a customer’s affordability profile, allowing us to set personalised borrowing limits accordingly. To further bolster our customer safeguards, we are fully regulated by the Financial Conduct Authority, having obtained a consumer credit license prior to our launch. 

Since launching as an FCA regulated business in the UK in September 2020 and in the US in May 2022, Zilch has amassed over 3 million registered customers. In that time, we have provided our customers with over £95 million in aggregate rewards and savings on fees and interest. Zilch is Europe’s fastest-ever company to go from Series A to double-unicorn status, in just 14 months, after raising capital at a $2bn valuation in November 2021 and maintaining that valuation in a subsequent funding round in Summer 2022.   

For more information, visit: www.zilch.com. 

Contacts: 

Zilch – Ryan Mendy, Chief Communications Officer:  

[email protected]  

For any media enquiries, please contact: 

[email protected] 

ABOUT STEPCHANGE 

StepChange Debt Charity is the UK’s largest debt advice charity, helping hundreds of thousands of people a year. 

Founded in 1993, StepChange supports people experiencing debt problems through telephone and online services, and campaigns for change to reduce the harm and stigma associated with debt.

How your readers can get help with their debts

We provide the UK’s most comprehensive debt advice service, from budgeting tips through to managing debt solutions that enable to people to pay off or clear debts. All our free debt advice is available by phone or on our website.

StepChange is currently experiencing problems with imposter firms, who pass themselves off as the charity in online adverts. As these imposters are prominent online, if you are directing an advice seeker towards our services, please include a direct link to our website: https://www.stepchange.org/

Our Helpline: 0800 138 1111

When we founded Zilch back in 2018, we were looking to answer one simple and fundamental question: is it possible to do for payments (and credit) what Google did for search? Is it possible to use advertising revenue to fund (or at least subsidise) the cost of payments, credit, savings, and rewards?

That framing of our business model can surprise people – even those who know our company well. But behind the scenes, it’s something all our talented team and investors believe in and is what clearly differentiates us from our competitors. It’s also why we’re confident in our growth strategy as we move into 2023 and beyond.

The model

Google offers its core business for free and funds it by selling adverts, meaning it can offer users an unparalleled, sustainable service – free search. Meta came along and did the exact same thing with social media. But, until we launched Zilch, nobody had ever used the same approach to bring value to customers whenever they pay. 

More specifically, if we could find a way to earn advertising revenue from retailers each and every time someone paid for something, then we could pass that revenue back to the customer in the form of free/subsidised credit, discounts, deals or rewards. That’s our model and our founding idea. We call it our Ad-Subsidised Payments Network (ASPN, pronounced ‘Aspen’). One of the major appeals of this approach is that global advertising spend is an enormous revenue pool on which to build a scalable and sustainable payments business – set to be worth more than $1 trillion annually by 2025.

Google and then Meta rode this wave to trillion-dollar valuations of their own. Those two companies alone account for roughly half of all digital ad spend but humbly, we believe that a payments platform is an even more appealing destination for advertisers to spend their marketing budgets – one doesn’t have to search to buy and certainly doesn’t have to use social media to buy, but one must pay.

So why is this possible now? Well the ad industry has been changing and we are all tired of paying for clicks and impressions…

The evolution of the advertising industry

“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” So said John Wanamaker, the Gilded-Age-era American department store entrepreneur.

The reason that search was able to wrestle advertising spend away from traditional media was precisely because it could better target ads and attribute outcomes to every dollar spent. Then social media enabled equally good ad outcome measurement but even better targeting.

The world has changed, however. Apple’s new privacy controls upended the targeting and measurement mechanisms around which a whole industry was built. Meanwhile, advertisers are increasingly aware of the ubiquity of ad fraud on search and social media.

Advertisers’ growing discontent with the digital behemoths with whom they spend most of their budgets can be seen in the growth of ‘retail media’. Retailers are now a major force in the online ad space with Amazon at the vanguard. In Q3 2022, Amazon generated quarterly advertising revenues of over $9.5 bn; less than five years ago advertising wasn’t even its own line item in the company’s financial reporting.

There are multiple benefits to advertising with retailers. You reach receptive consumers who are already planning to make a purchase. You get greater visibility of conversions into sales. And, in a cookie-less world, your ads can be targeted based on the retailer’s own ‘first-party data’ on what shoppers have previously bought rather than inferring what they might buy based on look-alike behaviour.

But there are also drawbacks. Most obviously, you can and would only place adverts with a retailer who stocks your product and they can only target your ads based on what that customer has bought from them in the past.

The Googlisation of Payments

Enter Zilch. A payments product which a customer can use whenever and wherever they make a purchase – online or offline – would have near unlimited earnings potential from ads. We can put the right brand or product in front of the right customers at the right time, and not only measure the conversion of the sale, but enable it, by providing them with the means to pay.

It’s that unique positioning that has allowed us to build our Ad-Subsidised Payments Network. An ecosystem of millions of Zilch customers, with money to spend, who use our product 80-100 times a year on average, is connected to thousands of competing retailers who can offer targeted deals based on the richest possible first-party data. We take a cut of the advertising revenue and pass the rest back to the customer in the form of market-leading cash back or interest-free short-term credit.

The results speak for themselves. Average e-commerce conversion rates are 1-2%. But as of December 2022, Zilch’s top 10 retailers convert on average 55.4%, with some as high as 72%. This means it’s converting around 30-70x more than the industry standard of search and social.

Payments have traditionally always been a thin-margin business (read: no value to customers) and we are proving that by leveraging growing ad spend as the shift to retail media accelerates. In this new cookie-less world payments businesses like Zilch can sustainably grow at an exponential rate while customers reap the rewards – literally.

Onwards and upwards.

Philip
CEO and Co-Founder, Zilch

P.s to discuss or hear more, reach out to my team directly on: [email protected]