US group Discover Financial Services will invest US$30 million in buy now pay later company Sezzle and the two companies will develop a BNPL “network solution” on the Discover global network.

Sezzle will issue 4.5 million shares to a Discover subsidiary, DFS Services, which will give Discover a shareholding of around 2.3 per cent.

Sezzle’s relationship with Discover goes back to February, when they signed an agreement allowing Sezzle to offer payment options to merchants on the Discover network.

By going through the network, Sezzle is able to offer merchants a BNPL option with little or no change to their payment systems.

Under the expanded partnership announced yesterday, the companies will work on a BNPL network solution and a dedicated referral program introducing Discover credit and debit products to Sezzle customers.

In a March quarter update, Sezzle said it had 2.6 million active customers and 340,000 active merchants. Underlying merchant sales for the quarter were A$492.5 million – an increase of 214 per cent over the previous corresponding period.