Split Pay Raises $125 Million to Bring BNPL to Big Expenses

Lending startup Split Pay has secured $125 million in new funding to bring buy now, pay later (BNPL) solutions to large expenses, Axios reported on September 8. The company's Series A and Series B rounds were led by Khosla Ventures, with Thrive Capital and Affirm CEO Max Levchin also participating. Split Pay aims to bridge the disconnect between large monthly bills and bi-weekly paychecks by allowing users to divide their payments into two installments.

The company believes that artificial intelligence will revolutionize underwriting, and its initial focus was on developing a new foundation model for people under 40. Split Pay's Co-Founder and CEO, Andrew Borovsky, a former Block/Cash App executive, noted that the biggest reason consumers struggle financially is due to the timing of their bills.

PYMNTS CEO Karen Webster analyzed the impact of bill timing on paycheck-to-paycheck consumers in a Sept. 9 column, identifying three groups of consumers: those facing everyday spending, short-term financial shocks, and long-term decisions related to housing, education, childcare, family support, or debt. Webster concluded that responsible BNPL used as working capital can help bridge the financial gap for these households.