Stitch, a South Africa-based payments service provider (PSP) and API infrastructure company, has integrated a merchant-first Buy Now Pay Later (BNPL) payment system into its platform. The new payment system will allow participating merchants to collect instalment payments from their customers.
This BNPL product supports collections of payment through online and in-store channels. Customers will be allowed to choose their preferred repayment schedule plans at the merchant's checkout page. Stitch allows the BNPL payments to be split between two and six instalments.
However, while customers are given the option to choose their preferable instalment repayment schedules for the overtime payments, merchants get settled with the full purchase amount, excluding the transaction fee on top. Stitch said it would settle with the merchants the full purchase amount within 24 hours.
This means Stitch manages the entire repayment lifecycle. The company pays merchants upfront payments for the items customers purchased within 24 hours, while it takes on the responsibilities of handling the collection of the instalment payments from customers. In a real sense, merchants have absolutely no risk to bear even if customers refuse to settle their outstandings.
By putting merchants' needs first in the BNPL model, Stitch uses the approach to eliminate the repayment fickleness that often makes instalment-based payments burdensome for merchants to embrace, especially in South Africa, where the BNPL payment market is expected to grow year over year (YoY) by 22.2% and hit $1.17 billion in 2026.
BNPL for Enterprise and E-commerce Merchants
Stitch clarified that 'enterprise merchants' (large and more established businesses) have a more customisable control over the BNPL model than businesses on Stitch Express, a plug-and-play checkout solution for businesses that integrate e-commerce services like WooCommerce and Shopify.
Enterprise merchants can manage the BNPL option for specific product categories and customise and display how it appears on their shopfronts, which can be added to their existing payments stack. In addition to that, enterprise merchants also get to see customers’ repayment behaviour.
On the other hand, Stitch Express businesses only get to activate the BNPL payment option for their customers through the use of the Stitch API to integrate it on their checkout page. It's more of a plug-and-play checkout solution, so it has limited options when it comes to customisations and preferences. Notably, the BNPL feature has already been beta-tested with Express merchants over the last few weeks before the official launch.
However, for merchants using Stitch payment solutions in-store, their customers can activate the BNPL feature simply by scanning a Quick-Response (QR) code at the checkout desk. The company noted that this method will mirror the online transaction processes.
Related: Zero-Based, Ad-Supported BNPL Business Model Explained.
Customers' Credit Assessment
Customers don't need to create a dedicated account to register for the BNPL or for Stitch to access their credit trustworthiness. The feature works in the sense that when customers are checking out at a participating merchant's checkout page using the BNPL option, they will be required to complete an onboarding process within the same merchant’s checkout page.
The customers will be required to complete their KYC verification, and the company will carry out a credit check using the customers' KYC information. The company clarified that customers' credit limits are determined and influenced by their credit histories. Once customers are assigned a spending limit, they can use it to purchase any item of their choice at any participating merchants using Stitch.
Embedding the BNPL service directly into its payments infrastructure set Stitch apart from existing players like PayJustNow that operate BNPL as a standalone layer. According to Stitch's Head of Marketing, Thea Sokolowski, the benefit of the internal integration is that customers will not be redirected from a merchant’s site whenever a BNPL service is selected as a payment option.
Notably, Stitch launched this BNPL service a year after it had secured $55 million in Series B funding and acquired Efficacy Payments in July 2025. Efficacy Payments is a South African Designated Clearing System Participant (DCSP) fintech company that specialises in card payment processing, digital disbursements, and cash displacement.
Stitch uses the acquisition to attain a DCSP licence so that it can offer end-to-end card-acquiring services without being dependent on banks or third-party processors.
