Zilla Temporarily Pauses Operations Due to Challenges in Consumer Understanding Impacting Growth

**BNPL Blues: Zilla Shifts Focus to Zillawire Amidst Customer Understanding Challenges**

Zilla, the Buy-Now-Pay-Later (BNPL) company established in 2021, has decided to suspend its BNPL services, redirecting its efforts toward the development of a cross-border payment product named Zillawire. The shift in focus comes as Zilla faced difficulties in persuading customers to embrace its BNPL offerings, as reported by sources familiar with the matter to TechCabal.

Challenges arose from a lack of customer understanding about credit, with many perceiving it as owing money rather than a flexible payment solution. According to an anonymous employee, potential users often prefer waiting until they can pay the complete amount rather than opting for installment plans.

Zilla has officially confirmed the decision to pause its BNPL services, citing the need to figure out certain aspects. The company expressed intentions to resume the service without specifying a timeline for its reinstatement.

Launched in 2021 by Tolu Abiodun, Zilla collaborates with approximately 100 merchants, offering products and services payable in two to four installments. While the BNPL adoption faced challenges, certain categories, such as electronics and high-end beauty products, exhibited relatively better performance. However, the maximum four-month payment duration posed a challenge, as some customers sought extended payment periods.

The company has now unveiled Zillawire, a cross-border payment product that facilitates foreign transactions between merchants and suppliers. Merchants using Zillawire are required to upload invoices and supplier account information for transaction processing. The decision to pivot towards cross-border payments arose from merchants' reported challenges with international payments. Zillawire, launched in August 2023, has exceeded expectations, prompting Zilla to prioritize its development over the resumption of BNPL services.