OurPass, a former e-commerce one-click checkout company, has pivoted to business banking. The company’s CEO, Samuel Eze, announced on LinkedIn that the startup was moving from providing a one-click checkout service to providing banking services to businesses. “As we studied the market, we recognised that beyond offering a niche service, OurPass could provide end-to-end solutions for businesses”.
The one-click checkout market
One-click checkout allows online shoppers to buy items with just one click of a button, without having to manually enter their shipping and payment information each time they make a purchase. Several one-click checkout startups sprung up after Amazon’s patent for the technology expired in 2017.
In 18 months from January 2021 to July 2022, startups like Fast, Ownit, Bolt, Checkout.com, OurPass, and Rapyd collectively raised more than $3 billion in investments. However, the market—which is projected to be valued at $5.9 billion in 2026— is shrinking. Fast shutdown in 2022, Bolt has conducted three rounds of layoffs, Rapyd has also conducted layoffs and now OurPass is pivoting.
OurPass previously called itself the “Fast for Africa,” but unlike its American counterpart which required only merchants to install its checkout product, OurPass needed customers to download an app and open a wallet before they could use its platform to shop. It also limited its customers to shop with merchants that had its API linked to their platforms.
At the time of its $1 million raise in September 2021, Eze told TechCrunch that “we did not want to defeat our USP of one-click checkout by allowing consumers to try to check out in one-click only for them to see their cards flagged as fraudulent, hence the reason why we had to build our system on a wallet system to enable that one-click checkout.”
The startup charged 0.8% per transaction, capped at N1,000 ($2.17) for merchants, and a commission of 5% on every product sold. OurPass also offered free delivery on all orders for its customers. The startup claimed to have processed $500,000 in transaction value in less than 6 months in 2021 and hoped to be the go-to platform for consumer checkout in Nigeria by 2023.
On a call with TechCabal, Eze shared that the post-COVID market reality necessitated a new direction for OurPass to satisfy its customers. “When we decided to start scaling the product, it was already post-COVID, and the dynamics of the market had changed. [A one-click checkout solution] didn’t matter to businesses anymore.
The number of businesses that we knew at the time (when OurPass was conceived at the peak of the pandemic) opened up and built e-commerce platforms, and this made us think that it was going to become the norm. But to our surprise, post-COVID things returned to normal except for the way people work, so it was no longer an interesting opportunity anymore.”
A new direction
Moving forward, OurPass will allow merchants to create a free business bank account to separate business and personal accounts. Businesses can also use OurPass to access business loans without collateral, generate payment links via email and SMS, and get paid instantly.
OurPass will also provide offline means of collecting payments with POS terminals. The startup would leverage a microfinance banking license from the Central Bank of Nigeria to spur its new direction.
Eze told TechCabal that OurPass has been providing banking services to businesses since June last year. In the LinkedIn post, Eze said, “We currently serve thousands of customers, including some of the biggest retail outlets in Nigeria like Spar, Shoprite, and EatnGo, amongst others; processing about 1,000,000 transactions monthly.” He also shared that OurPass also provides staff management tools to its customers.
The path to profitability
Eze also told TechCabal that it “has a clear-cut path to profitability as we speak”. The startup charges businesses 0.5% per POS transaction, capped at N1,000 ($2.17). Payment transactions are free except for a N50 stamp duty charge (which is mandated by law). The staff management tool is also free to use, but OurPass will charge a one-time service fee, according to Eze.
He also shared that OurPass aims to serve over 200,000 active businesses by the end of Q4 2023 to achieve profitability and has “deployed foot soldiers in market clusters around Nigeria” to acquire businesses. OurPass defines “active businesses” as customers that conduct at least five transactions daily.