With Apple Pay, Antwerp payment app Bonsai competes with major competitor Payconiq | Inland

Anyone who knows about the existence of the Bonsai payment app probably knows it because of the promise that a tree is planted for every ten payments you make with it. Ideal for those who want to clear their conscience or do something good when buying a flat white in the coffee bar.

You can also send money with it to someone else who uses Bonsai. The app can currently convince about 10,000 monthly users, Baats tells our editors. In total, 90,000 people installed the application on their smartphone.

With the launch of Google Pay earlier this month and Apple Pay last week, the Antwerp company wants to tap into a new market. This allows you to pay contactless with your smartphone as you can with many bank cards, without having to reach for your wallet. Until now, you had to be at the “right” bank customer to be able to use Google and Apple Pay. For example, Argenta does not support either method.

Bonsai changes that. The company behind the app is a payment institution, recognized by the National Bank of Belgium, and can link to current accounts of almost all Belgian banks. When you have done that, you can pay with Bonsai and the amount will be withdrawn from your account after a maximum of a few days without further steps.

You can now also pay via Google Pay and Apple Pay. For this, Bonsai creates a virtual card from Mastercard that works like the classic bank card. You do not pay with credit: the money goes directly from your account. Moreover, with Bonsai you can never go below zero at your bank.

Customers of banks such as Argenta, Belfius or Beobank finally have the option to use Google or Apple Pay via the detour from Bonsai. Striking, because the banks that don’t support it say they won’t because of the cost that Apple asks.

How much exactly Apple has to pay to support the service, Bonsai CEO Jelle Baats does not want to say. “There is part fixed costs and part variable. This also applies to Google Pay and Mastercard. It is known that Apple’s costs are higher than Google’s, but that is not so bad,” says the entrepreneur.

It is now important for Bonsai to recruit enough active users who make payments with the app. Bonsai earns a certain amount from each payment. Once sufficient payments are made, the fixed costs of Apple Pay, Google Pay and Mastercard become negligible. “Then we can break even and maybe even make a little profit out of it,” says Baats.

But Bonsai also promises to plant a tree with every tenth payment made with the app. This of course costs money, more specifically ten percent of the turnover that the company brings in with transactions. “We don’t look at the profit we make with it, because that’s not possible cheated become. That is important to us because you cannot manipulate turnover. That’s black and white,” explains the Bonsai CEO.

Meanwhile, the payment company that was founded in 2016 is far from profitable. In 2021, the start-up made a loss of more than 2.3 million euros. Jelle Baats is not immediately concerned about this. His company follows what he calls the “American model”: take a large share of the market first, then generate a profit.

Recently, however, that model has come under pressure. Tech stocks plummet, central bank interest rates rise making borrowing more expensive, investors are nervous. An illustrative example: Speed ​​camera delivery company Gorillas plans to lay off half of its office staff and refocuses on the countries where it operates 90 percent of its turnover. For this month, the company seemed to care little about making a profit, instead focusing on capturing the market.

Baats says he is not bothered by these trends, because Bonsai is a lot smaller and is in a different phase of life. “Our investors are part of that story. We are lucky. Let me put it to you: our losses will probably increase in the coming years before they decrease again. What matters now is market penetration. That is why we will launch in the Netherlands, France, Germany and Luxembourg next year.”

Once big enough, Bonsai can start earning money. How exactly is not yet set in stone. “Actually, we’re a bit like Facebook. We have a product that is free, like Facebook. At the same time, we will be offering services to other companies,” explains Baats. Think of ways to communicate as a trader about discounts to the users of Bonsai. The Antwerp start-up would then receive an amount in return.

In that search for users, Bonsai does run into a giant: Payconiq Bancontact Company. This payment company is owned by the major banks KBC, BNP Paribas Fortis, Belfius, ING and AXA Bank/Crelan. In addition to the well-known Bancontact payment system, it also manages the Payconiq payment app. The latter has a technical advantage: with Bonsai you have to link your current account again every 90 days.

Yet Baats is not afraid of the bigger competitor. For example, he believes that the social story of planting trees will encourage people to use Bonsai. Apple Pay and Google Pay are also functions that Payconiq does not have (for the time being). And worldwide the products of Payconiq Bancontact Company do not work, which Bonsai can now do thanks to the contactless payment methods.

The CEO is therefore also ambitious. “By the end of the year we want 50,000 active users and by 2025 we want a million,” he says. That is the number of users more than tenfold in three years. Whether that will work is a matter of coffee grounds, but at least Jelle Baats and his employees have enough to prove.