Younited Credit Raises $170M to Revolutionize Credit with Data Science

Younited Credit Secures $170 Million in Funding

Younited Credit, a French fintech company, has successfully completed a $170 million funding round. Goldman Sachs spearheaded the investment, with participation from existing investors including Eurazeo, Bpifrance, and AG2R La Mondiale. The company specializes in providing diverse credit solutions to consumers across Europe.

European Consumer Credit Landscape

The structure of consumer credit differs significantly between Europe and the United States. Unlike the U.S., many European nations do not primarily depend on centralized credit scoring systems for evaluating creditworthiness. Furthermore, credit card ownership is less prevalent among European consumers.

Consequently, financial institutions seeking to extend credit lines must undertake a thorough evaluation of the risks associated with each application. This process can often be complex and time-consuming.

Younited Credit’s Innovative Approach

Younited Credit distinguishes itself from traditional financial institutions through its utilization of a data-driven and AI-based methodology. Rather than requiring extensive documentation submissions to a bank representative, the company strives to automate application processes as much as possible.

The company leverages the DSP2 regulation and open-banking APIs to efficiently gather necessary data. Having processed a substantial volume of credit applications, Younited Credit is also able to utilize historical data to refine its machine-learning risk assessment models.

Growth and Market Presence

To date, Younited Credit has disbursed over €2.4 billion in credit, equivalent to approximately $2.8 billion based on current exchange rates. The company currently operates within five European countries.

While France remains its primary market, Italy, Spain, Portugal, and Germany collectively contribute 40% to Younited Credit’s total revenue.

Expanding Through Embedded Finance

Recently, Younited Credit has begun integrating its products into third-party platforms. Banks and fintech companies are now able to offer credit products directly within their applications through partnerships with Younited Credit.

Notable examples of these partnerships include collaborations with N26, Lydia, Orange Bank, and Fortuneo. In 2021, the B2B segment accounted for 30% of the company’s net banking income.

Future Plans and Workforce

Currently, Younited Credit employs 440 individuals. The company intends to expand its team by hiring an additional 200 employees over the next 18 months. A key focus will be strengthening its presence in existing European markets.

Introducing Younited Pay

Younited Credit is focused on expanding its embedded finance offerings, specifically with Younited Pay. This product aims to provide credit options directly at the point of sale on popular e-commerce websites and applications.

This positions the company to compete with “buy now, pay later” providers like Klarna, Floa, Oney, and Scalapay. Younited Pay will offer flexible payment terms ranging from 3 to 48 months.

Several companies, including Free, Micromania, and LDLC, are already utilizing Younited Pay. The solution is available for both online and physical retail locations.

Younited Credit continues to prioritize accessibility, meeting customers where they already are. This strategy appears effective, as over 50% of Younited Pay transactions currently occur at physical points of sale.