Stitch enters South Africa’s BNPL market with merchant-first model

Stitch, a South Africa-based payments infrastructure company, has launched a Buy Now Pay Later (BNPL) product for merchants, expanding its platform to support instalment payments across merchants’ online and in-store channels.

The company noted that the product would allow merchants to offer customers flexible repayment options at checkout by letting them choose their repayment schedule and split purchases between two and six instalments. 

While customers pay over time, Stitch said it would settle merchants the full purchase amount, minus fees, within 24 hours to remove the repayment uncertainty that makes instalment payments difficult to adopt.

The BNPL payment market in South Africa is expected to grow annually by 22.2% and reach $1.17 billion in 2026. Stitch is positioning itself to capture that demand by embedding the service directly into its existing payments infrastructure.

“What sets our BNPL product apart is both its commercial performance — we’re already seeing higher approval and facility rates than other players in the market — and the flexibility we offer consumers to choose a repayment term that genuinely works for them,” said Junaid Dadan, President and Co-founder at Stitch. 

“For enterprise merchants, that translates to more conversions, higher average order value and a better customer experience.”

Stitch said that its BNPL feature would enable enterprise merchants to customise how the feature will appear on their storefronts. Merchants can display the option for specific product categories and also gain visibility into customers’ repayment behaviour.

According to the company, businesses on Stitch Express, a checkout solution for businesses that use e-commerce platforms like Shopify and Woo, can activate the BNPL feature through a toggle on their dashboard, while enterprise merchants (larger businesses) have a more customisable implementation model that can be added alongside their existing payments stack. 

For in-store payments, customers can scan a (Quick-Response) QR code at checkout to launch the BNPL flow that mirrors the online transaction, the company noted.

Once the feature is selected, customers will be prompted to complete an onboarding process within the merchant’s checkout, including Know-Your-Customer (KYC) onboarding and a credit assessment. The company noted that based on their credit history, customers are assigned a spending limit, which they can use across participating merchants.

“BNPL has been steadily growing in popularity in the South African market, and it’s now becoming table stakes for retailers,” Thea Sokolowski, Head of Marketing at Stitch, said. “We serve a lot of South Africa’s largest retailers, and a rapidly growing number of small to medium e-commerce businesses, and we increasingly hear demand from them for a BNPL option that works seamlessly alongside our existing payment methods.”

Stitch noted that it manages the entire repayment lifecycle. Merchants would be paid upfront within 24 hours, while it takes on the responsibility of collecting instalments from customers. This structure means the merchant carries no default risk, even if a customer fails to repay.

The BNPL landscape in South Africa already includes players that operate as standalone layers, including PayJustNow, which partnered with Shoprite Group in January to provide BNPL services to customers, and Happy Pay, which raised $5 million in March.

Stitch said its approach differs from that of existing players because it embeds the service directly into its payments infrastructure. 

“Existing players in the market direct customers away from a merchant’s site to their own app, once they select BNPL at checkout,” Sokolowski said.  “We keep the customer in the payments flow on the merchant site the entire time… customers won’t be redirected to a marketplace once they complete a purchase.”

The BNLP product launch comes a year after Stitch raised a $55 million Series B round and its acquisition of Efficacy Payments, a digital payments startup with direct access to the national clearing system, in July 2025. The acquisition allowed Stitch to offer end-to-end card-acquiring services without relying on banks or third-party processors. 

Although officially launching now, Stitch noted that it had tested the product with its Express merchants over the last few weeks. 

“Today, we offer the most reliable, comprehensive payments platform for enterprise businesses in South Africa, and BNPL is the next important step in that journey,” Dadan said.