Younited Credit raises mega-round to double down on embedded finance

The news: The French fintech, which offers credit products to European consumers, secured a $170 million round led by Goldman Sachs, per TechCrunch. It will use the funding to move deeper into European markets and grow its workforce.

Here’s how it works: Younited Credit offers a range of personal loans from €1,000 ($1,140) to €50,000 ($57,013), including auto finance and work loans that can be used to fund maintenance work.

The alt lender uses a data-driven, AI-based approach to assess consumer creditworthiness. It also relies on PSD2 and open banking APIs to make the most of available data and can feed its machine-learning risk models with data from previous consumers to accurately assess individual situations. This saves consumers from having to send documents to providers and lets Younited Credit automate request processes as much as possible.

Younited Credit has granted more than €2.4 billion ($2.74 billion) in credit and operates in France, Spain, Portugal, and Germany—though its home market still represents 60% of its revenues.

What’s next? Younited Credit will look for more opportunities to embed its products into ecommerce platforms, a market that’s heating up in France.

It teamed up with N26 in 2017 to help the neobank launch credit options within its app. It added similar partnerships over the last year, working with fintech Lydia in July 2020 and Orange Bank last month. B2B partnerships now account for 30% of its net banking income.

In the future, the fintech wants to focus on embedded finance with a credit product dubbed Younited Pay, which can integrate with ecommerce platforms and offers payment terms from three to 48 months. Retail ecommerce sales in France are expected to grow from $74.07 billion in 2020 to $106.20 billion in 2025, per an Insider Intelligence forecast.

Pushing into the buy now, pay later (BNPL) market puts Younited Credit in competition with Australia-based Afterpay and Sweden-based Klarna, which launched in France in March and June, respectively. Additionally, homegrown startups like Alma recently scooped up $59.4 million, further highlighting how hot the BNPL market is in France.