By Ryan Weeks on 19th September 2017
French public investment bank Bpifrance joins others in landmark fundraise.
In the UK, the British Business Bank has on numerous occasions made headlines for funding loans through top-tier marketplace lending platforms. Now the French public investment bank has gone a step further, taking an equity stake in France’s biggest marketplace lender.
Younited Credit, formerly known as Pret d’Union, has raised €40m from a group of new and existing investors. The former group is headlined by the French public investment bank Bpifrance (through its Large Venture hub), with French insurer Matmut Group (via Matmut Innovation) and Zencap Asset Management also piling in for the first time. Existing investors Eurazeo, Crédit Mutuel Arkéa, AG2R La Mondiale and Weber Investissements also participated. Younited Credit has now raised a grand total of €103m in equity capital to date.
“We were attracted by Younited Credit’s team and by its unique positioning built in Europe,” said François Fournier, chief innovation executive of Bpifrance. “Its innovative digital platform model, great product agility thanks to big data, as well as its solid regulatory strategy, inspire confidence and sustainability.”
The money will be used to fund Younited Credit’s expansion across Europe, with the platform already active in France, Italy and Spain. An article in Bloomberg this morning revealed that the question mark of Brexit has postponed the platform's decision on whether or not to enter the UK. It will also use the €40m to accelerate the development of new products.
Younited Credit claims to have been the first platform in France to have launched an entirely online application process for borrowers. Now the firm looks set to continue its research into applications for cutting-edge technologies, including Artificial Intelligence (AI). Younited Credit has also developed APIs in order that its services may be licensed by partners, including neo-banks, mobile operators and insurers. The white-labelling of platform technology is becoming increasingly common within the online lending sector. Kabbage, for example, is one of its pioneers.
With the extra €40m in firepower, Younited Credit will continue to invest in data science, credit scoring and the development of its proprietary technologies.
Younited Credit has lent approximately €550m to date, of which €250m has come in the last 12 months, according to AltFi Data. Interestingly, it is smaller loans that seem to be driving the consumer lender’s growth. Loans between €1,000 and €3,000 now account for 40 per cent of the platform’s total loan originations.
Momentum continues to build behind France as an emerging hub for fintech lending. Business lending platform Lendix landed an €18.5m funding deal with the European Investment Bank in July, seemingly taking over from UK-based marketplace Funding Circle as the bank's preferred distribution partner. Funding Circle was forced to cancel a planned multi-billion pound SME funding programme with the British Business Bank as a direct consequence of the UK's Brexit vote in June.
AltFi is returning to Amsterdam for its second annual Summit in the city. The inaugural event last year was a roaring success, with key figures from across Continental Europe's alternative finance and digital banking sectors highlighted. These included Jeroen Broekema, managing director of Funding Circle Netherlands, and Mieke van Engelen, head of innovative partnerships at ABN AMRO's standalone lending platform, New10.