Humm to stop offering NZ buy now pay later service

Buy now pay later benefitted from a rise in online shopping during the pandemic. Photo / NZME

Australian financial services group Humm is to close down its Kiwi buy now pay later operation on September 25.

The ASX-listed company confirmed the closure as part of the announcement of its financial results yesterday.

Humm Group said it was due to it re-prioritising its focus on its core strength - partnerships across its cards and point of sale business.

"As a result, two of its non-core products, bundll NZ (including the Red Bird joint venture) and hummpro, were decommissioned in 2HFY22 and humm NZ will close in Q1FY23."

"These products combined contributed to a cash NPAT (net profit after tax) loss of A$17 million in FY22."

Humm's New Zealand customers were told in an email yesterday that the company was consolidating its customer products in New Zealand.

"... unfortunately this means that humm Buy Now Pay Later, for both Little things and Big things, will no longer be available in New Zealand from 25 September 2022."

Customers were told they could continue to use the service as normal until then and then payments would continue to go out as normal even if this stretched beyond the close-down date.

"Once the final amount owing on your humm account (both Little things and Big things) has been paid, we will close your account."

Humm which was previously called FlexiGroup launched buy now pay later into the New Zealand market in August 2017 with a product called Oxipay.

It then expanded its service to small and medium-sized businesses in 2021 allowing them to access up to $30,000 with no interest for up to six months.

Humm had been planning to sell its buy now pay later business to Latitude Financial for A$335m but the companies abandoned the deal citing major disruption in the markets.

Buy now pay later businesses thrived during the global pandemic as shoppers were driven online to make purchases but the high growth and high capital needs businesses have seen their share prices plummet with rising interest rates.

Humm Group yesterday revealed a cash net profit after tax of A$51.1m and a net loss after tax of A$170.3m.