Shopify To Offer Merchant Accounts, Announces Payment Support For Installment Plans

Shopify Inc. SHOP announced multiple new products at Reunite, a virtual conference in which one million participants using its e-commerce platform took part. 

What Happened

Among the key announcements made at Reunite was Shopify Balance, a financial product aimed at entrepreneurs. The merchant account has no monthly fees, sign-up fees, or minimum balance. It also comes with a debit card, announced TechCrunch.

Craig Miller, Shopify’s chief product officer, said, “The traditional products offered by banks were created in a world that’s very different.” He added, “We went back to first principles of how they should be designed.”

Shopify also announced Buy Now, Pay Later feaure, as a part of its Shop Pay installments feature. Merchants can offer their customers the benefit of splitting their payments into four equal installments with no interest or additional fees. 

Why It Matters

According to TechCrunch, Features such as Shop Pay Installments come at a time when there is record unemployment, and people face difficult economic times due to the COVID-19 pandemic.

Merchants selling big-ticket items stand to benefit, as customers will not have to bill these items to their credit cards, and merchants will get paid instantly when customers use Shop Pay Installments.

When asked by TechCrunch, Shopify declined to name its financial partner for both Balance and Shop Pay Installments. Both will be launched in 2020.

Other features launched at Reunite include local delivery and Shopify Email, a tool to connect with customers.

The virtual event comes on the heels of the launch of Facebook Inc.'s FB Shops, an initiative that will allow the creation of digital stores on Facebook and Instagram. Shopify is a partner in Facebook Shops.

Shopify Price Action

Shopify shares traded 0.26% higher at $780 in the after-hours session on Wednesday. The shares had closed the regular session 3.25% higher at $778.