Buy now, pay later (BNPL) provider Sezzle has filed an antitrust lawsuit against Shopify, accusing the e-commerce giant of stifling competition. Filed in the U.S. District Court for the District of Minnesota, the suit alleges that Shopify used its dominant market position to unfairly promote its own BNPL solution, Shop Pay Installments, developed through a partnership with Affirm.
According to Sezzle, Shopify manipulated merchant checkout systems to make it extremely difficult for consumers to choose alternative BNPL options. The lawsuit also claims Shopify penalized merchants for using third-party providers like Sezzle by imposing fees and restrictive contracts. Sezzle argues these tactics limit innovation and choice for both merchants and shoppers.
The company is seeking trebled damages and an injunction to stop what it calls “anticompetitive†behavior. CEO Charlie Youakim emphasized that the legal action aims to preserve fair competition and ensure that businesses and consumers can choose from a range of BNPL services without interference.
This lawsuit could have significant implications for how platforms like Shopify manage financial service integrations and treat competing payment providers.