Correct the traditional BNPL models are extremely capital efficient and is one of the reasons why the model is so successful. A debt facility of say $200m can service $1bn+ in loans.
But this isn't really related to the 4% vs 0.7% margin arguement.
But your understanding of the capital efficiency of funding warehouse facilities is correct. This is one of the reasons why ZipPay is a more lucrative product than ZipMoney since the turnover is much quicker. This is also the reason why FXL has been trying to shift away from ZipMoney-type products to ZipPay-type products, albeit with limited success so far.
Z1P Price at posting:
$6.20 Sentiment: Hold Disclosure: Held
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