Instalment payment company Sezzle has secured a new two-year credit facility to support its business in the US and Canada but will have to add high funding costs to its long list of challenges.

The company announced that it has signed a US$100 million facility agreement with finance company Bastion Management, which replaces its previous facility with Goldman Sachs and Bastion.

Sezzle will pay a margin of 11.5 per cent over the secured overnight financing rate (SOFR – the replacement for US LIBOR), which is currently around 3 per cent.

Sezzle said its net interest expense as a percentage of underlying merchant sales will increase by 30 basis points.

In August, Sezzle reported a loss of US$43.1 million for the six months to June, compared with a loss of US$30.7 million in the previous corresponding period.

Revenue rose 6.5 per cent to US$56.9 million but expenses rose 20.6 per cent to US$96.6 million.

Active customer numbers grew 18 per cent to 3.4 million and active merchant numbers grew 18 per cent to 47,642.