Budget Insight finds new US funding

Budget Insight, the leading FinTech in Open Banking in France, made news in France in 2019 when it was acquired by Crédit Mutuel Arkéa. The banking group was looking to gain legitimacy in a booming market by acquiring a value aggregator. But things are changing today as Budget Insight has just found a new majority shareholder from the US.

FACTS

• The French FinTech specialising in banking data aggregation has been acquired by US fund Providence Strategic Growth (PSG) Equity. The amount of the investment was set at $35 million (€31 million).

• Budget Insight's management team and its previous majority shareholder, Crédit Mutuel Arkéa, will remain in the FinTech's capital but will now hold a minority stake (20%).

• Further funding is already planned to help Budget Insight make acquisitions abroad.

• Budget Insight hopes to achieve similar growth in 2022 to that of 2021, i.e. between 40 and 50%. Budget Insight also plans to recruit 50 people this year and to significantly strengthen its teams by 2025.

• This transaction remains subject to the authorisation of the Autorité de contrôle prudentiel et de résolution (ACPR).

CHALLENGES

• From Open Banking to Open Finance: In the announcement of its new fundraising, Budget Insight does not specify a precise strategic plan for the launch of new services, but rather a shift by the FinTech towards Open Finance. Budget Insight is looking to compete with industry giants such as Tink, Plaid or the very recent entrant to the Open Banking market Klarna.

• Going European: In addition to France, Budget Insight also intends to use its new funds to expand its services in Europe and the US.

• A turning point for Crédit Mutuel Arkéa: In line with its new strategic plan, the bank is now divesting itself from the FinTech sector to focus on new priorities. The bank is now defending its technological efforts less than its CSR, local and environmental values.

MARKET PERSPECTIVE

• The strategic shift announced by Budget Insight towards Open Finance underlines a nascent trend already involving several players, led by Rollee and Qard.

• More than banking data, these players rely on the analysis and processing of multiple financial data to optimise the personalisation and relevance of services.