Australian fintech Zip Co has partnered with global payments platform Stripe and accounting software provider Xero in a bid to tackle one of the country’s most pressing small business challenges – late payments.

The new integration allows businesses using Xero and Stripe to add Zip’s flexible payment options directly to invoices.

Customers can choose to split payments via Zip, while the business receives the full invoice amount upfront, minus applicable fees.

“This integration means small businesses in Australia on the Xero platform, with a Stripe account, can now add Zip’s flexible payment solutions directly on their invoices, providing customers with greater payment flexibility and helping businesses to reduce payment friction and support cash flow management,” said Soraya Alali, Zip ANZ CEO.

Soraya Alali, Zip ANZ CEO

Late payments cost Australian small businesses an estimated $1.1 billion annually, with half of all invoices paid after their due date, according to Xero’s Small Business Report.

The companies say the new offering will give business owners more control over their cash flow while reducing time spent chasing overdue accounts.

Xero Senior VP of Payments Bharathi Ramavarjula said: “The more payment methods we can offer with Stripe, such as Zip, the more likely it is that our customers will get paid up to twice as fast, helping to strengthen their financial position, and reclaim hours spent chasing late payments.”

Bharathi Ramavarjula, Xero Senior VP of Payments

Stripe Managing Director for Australia and New Zealand, Karl Durrance, said the collaboration showed how technology can ease longstanding operational challenges: “Small businesses get paid faster while offering their customers more flexible payment options, opening up new possibilities for growth.”

The integration is available immediately for Australian businesses using both Xero and Stripe.

Karl Durrance, Stripe MD for Australia and New Zealand