WebBank To Be Fintech Firm Sezzle’s Exclusive Bank
The Utah-based WebBank, will serve the Minneapolis-headquartered “Buy Now Pay Later” fintech firm Sezzle in the US as its exclusive bank to originate and finance products currently offered through the Sezzle platform, including Sezzle’s “Pay-in-2” and “Pay-in-4” products, subject to limited exceptions.
WebBank will also serve as the exclusive issuer of all Sezzle subscription products and the exclusive issuer of Sezzle card products, including the Sezzle Virtual Card (subject to up to a one-year transition period) and gift cards, Sezzle informed the US Securities and Exchange Commission (SEC) in an 8-K filing on Wednesday.
WebBank, through Sezzle’s marketing efforts, will offer loans to U.S. customers to finance purchases of merchant products through the Sezzle platform or within Sezzle’s direct merchant network. Sezzle, subject to WebBank’s review and approval, will act as the administrator of the program and master servicer, with responsibility over the marketing, administration, legal and compliance, application of WebBank’s underwriting criteria, origination assistance, and ongoing servicing functions, the 8-K filing said.
The two companies entered into a strategic partnership program by executing a loan and receivables sale agreement and marketing and servicing agreement on August 6, Sezzle said. Subject to completion of confirmatory testing and procedures, the program is expected to launch in September, according to the filing.
Loans to US Customers
WebBank, through Sezzle’s marketing efforts, will offer loans to the US customers to finance purchases of merchant products through the Sezzle platform or within Sezzle’s direct merchant network.
During the company’s quarterly earnings call on August 7, Sezzle CEO Charlie Youakim said that his company nearing the completion of its implementation with a bank sponsor partner.
“The benefits of the sponsorship are expected to include the launch of unified fees; a streamlined regulatory approach; and future potential consumer product launches, including checking accounts, cash advances and credit-building products,” Youakim said.
Wednesday’s SEC filing comes on the same day Sezzle said that it has teamed up with embedded finance platform Liberis to launch Sezzle Capital, a program designed to help small and medium-sized businesses (SMBs) get financing without sacrificing equity.
The program is designed to offer flexible funding to SMBs in the U.S., and there are plans to eventually launch in Canada.
Youakim said that they were committed to empowering the next generation of business owners through accessible funding opportunities for merchants of all sizes.
“Through our partnership, we are thrilled to offer our merchants funding via Liberis — without the need to give up equity in their businesses,” Youakim added.
