New buy now, pay later service Laybuy launches in UK with Footasylum

The buy now, pay later phenomenon in UK retail has taken a new turn, with Klarna alternative Laybuy securing its first big industry deal in the country.

Footwear retailer Footasylum has teamed up with payment technology provider Laybuy – a strong player in the New Zealand retail market – to give its shoppers new ways to pay for their purchases online.

Laybuy allows consumers to spread the cost of purchases over six interest-free payments, with the first being made at the point of sale.

Although the new payment service is only available online at Footasylum from today, it will become an in-store payment option in Footasylum’s 70 UK stores later this year.

Clare Nesbitt, CEO of Footasylum, said: “Laybuy’s proposition represents a unique offering for our customer base.

“We believe that by providing customers with a means of paying for our products over time as part of their weekly budgeting, this partnership will be a positive step forward for us.”

Laybuy launched in New Zealand under two years ago, and the company says that 375,000 people have already signed up to its platform. Some 3,750 online and physical store partnerships have also been forged in that time.

Although in the same sphere as Klarna – a buy no, pay later service that has made waves in the UK and Europe in recent months thanks to partnerships with the likes of Asos and Arcadia, and which H&M has a stake in – there are differences in the Laybuy proposition.

Laybuy absorbs all credit risk on any transaction, which it says safeguards its retail partners, and it also handles all foreign exchange fees on a retailer’s behalf due to its multinational capabilities.  

The platform has been built so that UK merchants who ship to Australasia do not require a localised website or bank account for those regions – as Laybuy handles the foreign exchange element of the transaction.

Upon completing an Experian credit check, Footasylum shoppers are allocated a spending limit of between £60 and £720 subject to their score. Purchases can then be made up to the value of that limit, but if users wish to spend more they can pay the difference in cash.

Laybuy takes a commission on each sale made via its platform, and users who fall behind on their payment schedule will see their Laybuy accounts immediately frozen, and therefore won’t be able to wrack up mounting debts by solely using the service.

Gary Rohloff, founder and managing director of Laybuy, has held leadership roles at an array of New Zealand retail businesses. He was managing director of catalogue retailer Ezibuy for three years, and he held the CEO job at two prominent chains, Warehouse Stationery and Number One Shoes, for three and seven years respectively.

He has established Laybuy as a family business, alongside his wife, Robyn, and son, Alex. They have grand ambitions for the company, too. “We’re going to try and create an ubiquitous global brand,” he told Essential Retail.

“You have to dream big – we want people to say, you just Google it, Uber it, Laybuy it. We would love to have that legacy to tell our grandchildren.”

Commenting on Laybuy’s position in the market outside its homelands, he said it will have a presence in Europe and the US before the end of the year, and he expects the UK team to grow as it scales in the months ahead.

“I’m absolutely delighted that a company like Footasylum, which is quite clearly an innovator and a leader in change in retail, has chosen to adopt our platform which is changing the face of retail in Australasia,” he added.

“I don’t think for the majority of retailers this is a question of Klarna or Laybuy, it is a question of Klarna and Laybuy. From a retailer’s perspective why wouldn’t you offer your customers choice?”