Zip (ASX:Z1P) share price up amid childcare partnership news

Zip is linking up with the childcare industry.
The post Zip (ASX:Z1P) share price up amid childcare partnership news appeared first on The Motley Fool Australia. –

The Zip Co Ltd (ASX: Z1P) share price is currently higher amid news that the buy now, pay later operator is linking up with a business in the childcare sector.

According to reporting by The Australian, from next month families will have the ability to pay for childcare at more than 10,000 centres in Australia and New Zealand by using buy now, pay later.

Zip is working with Xplor Education which provides administration and parental support to childcare centres. The buy now, pay later option will be added to payment options with centres linked with Xplor Education.

There are two benefits that will supposedly come from a shift to buy now, pay later. The first is that Xplor Education aims to make childcare more affordable and flexible for families. The other area is saving on time because of how often staff are chasing fees and collecting invoices.

The Australian quoted Xplore Education CEO Mark Woodland, who said:

We know there is demand for tailored payment options in the Australian market, and believe this innovative initiative will improve access to childcare for more families. What we’ve added through the Zip partnership is the ability for parents to spread the cost of childcare, which can be incredibly expensive. Parents usually have to choose between picking up an extra shift and having to choose if their child can go into care or not, and they just don’t have the means to fund it.

One of the areas that investors may look at when deciding what to value the share price is its transaction volume, which Zip is probably hoping will rise from this partnership.

How will it work?

The Australian reported that new customers would be subject to credit checks. However, childcare customers wouldn’t be paying in four equal instalments. Zip’s commercial director, Colin Baines, explained that families can change the monthly repayments to repay multiple invoices.

Mr Bains said:

They’re paying it off on a monthly cycle, so it actually helps from a budgetary and management perspective with customers.

Consumers can opt to pay the minimum amount that’s required with us, or they can choose to make additional payments. We work with our consumers in relation to the payback and how they are paying those moneys back, and we find that only 1 per cent of all our consumers across the platform fall into a position where they can’t make repayments with us.

Zip share price snapshot

The buy now, pay later business is currently up by 1.2% at the time of writing. That compares to the S&P/ASX 200 Index (ASX: XJO) which is up 0.2%.

The broker UBS still rates Zip shares as sell, with a price target of $5.40. One of the things it notes is the recent proposed rules relating to payment surcharges.

The post Zip (ASX:Z1P) share price up amid childcare partnership news appeared first on The Motley Fool Australia.

Should you invest $1,000 in Zip right now?

Before you consider Zip, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Zip wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

These are the 10 most shorted ASX shares

3 buy-rated ASX shares

Why Core Lithium, Firefinch, Smartgroup, and Zip shares are falling

What do analysts think of the Zip (ASX:Z1P) share price following the rebrand?

Afterpay (ASX:APT) and other BNPL shares in focus as RBA looks to rein in regulation

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!