Interview by Carolina Oliveira
F6S Innovation
Benjamin Berényi is the CEO and Co-founder of PastPay, a B2B BNPL (Business to Business Buy Now Pay Later) financial technology startup from Hungary that is revolutionising how companies are making more agile and instant payments.
Can you tell us about the journey of PastPay? What inspired you to start a B2B BNPL and digital factoring provider in the CEE region?
PastPay’s journey began with a deep understanding of the challenges businesses face in the CEE region, particularly regarding cash flow management and payment delays. We recognized that the local financing culture needs to catch up to more developed markets, where alternatives like factoring and Buy Now Pay Later (BNPL) are more commonly used. This gap inspired us to create a solution tailored to the unique needs of businesses here.
We also saw digital advancements in the B2B (business-to-business) sector have been slow recently. As a result, there is a significant demand for innovation and new technologies in this area. Many companies struggle with late payments, creating a domino effect that disrupts the entire supply chain. We wanted to develop a service that would provide immediate payment to sellers while offering buyers the flexibility to pay later—up to 90 days after purchase. This way, the merchants and the buyers can maintain their liquidity, ensuring smoother operations on both sides.
This led to the development of our digital factoring and B2B BNPL services, which combine innovative technology with financial solutions to improve the payment experience and support business growth. By offering these services, we aim to bring much-needed financial flexibility and innovation to the B2B market in the CEE region, helping businesses navigate the challenges of a rapidly evolving market.
With PastPay’s B2B Buy Now Pay Later, buyers pay on their terms. Meanwhile, merchants receive their money immediately after fulfilling the order without having to manage collection issues or worry about late payments. This allows both parties to focus fully on their business goals.
What specific challenges do businesses in the CEE region face regarding cash flow and financing, and how does PastPay address these issues?
As mentioned earlier, maintaining liquidity is a major challenge for companies and is. crucial for economic stability today. A well-functioning economy relies on timely payments. However, many buyer companies frequently fall behind on payments, and merchants can only address these delays through lengthy and cumbersome legal and administrative processes. This leads to deteriorating cash flow and creates a vicious cycle: if a merchant isn’t paid by their customer, they can’t pay their own suppliers, and so on. This problem prevents both parties from fully focusing on their business goals and growth. It causes liquidity issues and requires significant resources to manage collections.
PastPay is a seamlessly integrable, flexible payment solution that offers a quick and straightforward approach to managing financial transactions. This solution allows both parties to operate flexibly and improve their cash flow. Corporate buyers can choose to pay within 15 to 90 days under more convenient terms, while merchants receive immediate payment upon order fulfillment. Unlike traditional factoring, PastPay automates the entire process, making it easy to integrate into online stores or even for merchants who prefer direct (offline) sales. Merchants can offer extended payment deadlines with just a few clicks on our platform and can also combine online and offline sales.
Can you explain how your BNPL model works for B2B transactions and how it benefits both buyers and sellers?
With PastPay, merchants can offer BNPL payment method to their corporate buyers across multiple sales channels simultaneously, all through our unique PastPay Portal. For those who sell through eCommerce, we provide webshop integrations, including plug-and-play extensions for WooCommerce, Magento, Shoprenter, Unas, and Prestashop and API integrations for custom-built webshops. We designed PastPay to ensure that every step of the process—from contract signing and customer verification to invoice management and financing—is fully digital and automated.
The BNPL process involves the following four steps from the merchant’s side, whether integrating PastPay into an online store or using other sales channels: The corporate buyer places an order and selects PastPay as the payment option. Our algorithm automatically evaluates, in real-time, whether we can finance the given buyer. After the order is fulfilled, we immediately pay the merchant the invoice amount. The buyer settles the payment with PastPay when the extended payment term expires. For corporate buyers, the process to use PastPay is as follows:
The buyer selects the PastPay BNPL payment option at checkout.Then, he logs into the PastPay App online interface. He confirms the order with a single click. As the payment deadline approaches, he pays to PastPay. Merchants receive immediate payment for their sales with PastPay, improving cash flow and reducing non-payment risk. By offering flexible payment terms, merchants not only enhance customer satisfaction and loyalty but also encourage repeat business and foster long-term relationships.
Additionally, providing BNPL options can give merchants a competitive advantage, helping them stand out in the market. This approach has been shown to increase B2B revenues on average by 20-30%. Buyers can pay when it’s convenient for them without impacting their credit score, preserving their creditworthiness. PastPay’s flexibility enables them to manage their cash flow more effectively by maintaining liquidity and allocating resources to other critical business areas.
What are the regulatory challenges you face in the CEE region, and how do you navigate them to ensure compliance and trust?
One of the biggest challenges for B2B BNPL is overcoming the lack of trust. Low confidence in services is a widespread issue in the financial sector. With PastPay, we introduced a new product that didn’t exist in the market before, so many business owners are either unfamiliar with or only vaguely aware of this payment solution.
We expected this, knowing that in today’s digital world, continuous customer education is essential for any innovation to make a real impact. From the beginning, we focused on ensuring the market understands how PastPay works and its benefits. We’ve also created a multi-language PastPay Knowledge Base on our website, making information accessible to everyone.
Another challenge in the financial sector is the constantly changing regulatory environment. We understand the importance of this and are committed to staying up to date with the latest laws and regulations. This commitment ensures that our service is always compliant with legal requirements, providing our partners with a secure and trustworthy service.
Could you share some success stories where PastPay has significantly impacted a business’s growth or stability?
It’s hard to single out just one success story, but AW Gifts is a standout example. Initially, AW Gifts implemented PastPay’s B2B Buy Now Pay Later payment method in their Slovakian branch. They were met with such favorable outcomes—marked by enhanced customer satisfaction, streamlined operations, and a significant uptick in sales—that the company decided to roll out the same solution at their British and Spanish branch. This decision was driven by the desire to harmonize their international sales strategy and leverage the benefits of flexible payment options across their entire operation. As a result, AW Gifts not only improved its operational efficiency but also strengthened its leading position in a highly competitive market.
How do you see the future of BNPL and digital factoring evolving in the next five years, particularly in the CEE region?
The current fintech solutions in the CEE region mainly have a supportive role, but this is expected to change in the next few years with more independent players entering the market. I previously mentioned that the lack of openness makes it difficult to introduce innovative fintech solutions. However, thanks to the growing focus on digital and financial education, people’s digital skills are improving, which is creating a more welcoming and favorable environment for fintech innovations. There is increasing openness to financial digitalization and a growing willingness to try new technologies, and among younger generations, trust is gradually shifting from traditional financial institutions to fintech solutions.
Everyone remembers a few years ago when there was widespread scepticism and distrust even towards contactless bank cards. Fast forward to today, and paying with a mobile phone is becoming increasingly common. This shift demonstrates a genuine increase in trust towards new technologies. What’s more, this acceptance isn’t limited to just younger people; it’s also reaching older generations. Although there is still a considerable gap in the adoption of financial technologies in the CEE region compared to Western Europe, this gap is closing rapidly.
I see BNPL becoming increasingly prominent in the region in the next five years. As the digital economy continues to expand, the demand for flexible and accessible financing options will grow significantly. Consumers and businesses are seeking solutions that offer convenience and improve cash flow management, which BNPL is well-positioned to provide.
As the winner of the Startup price competition at Unchain Festival 2024, what advice would you give to other fintech entrepreneurs looking to launch in emerging markets, based on your experiences with PastPay?
This is a complex question, and I could offer extensive advice, but the most crucial point is first to understand local needs and challenges. Each market has its unique characteristics and pain points, so it’s vital to invest time in researching and grasping the specific needs, regulatory environment, and financial behaviours of the region you’re entering. Once you understand clearly, focus on building trust and educating the market.
In many emerging markets, financial technology may still be in its early stages, so it’s essential to ensure that your solution is well-understood, secure, and tailored to local needs. Educating potential users about the benefits of your technology and demonstrating its relevance will help overcome scepticism and facilitate adoption. Additionally, be flexible and prepared to adapt your approach based on feedback and changing market conditions.
