Pass Flash TPE: Younited Credit Further Looking into SME Lending

FACTS

• Bpifrance, Crédit Mutuel de Bretagne, the Brittany region and Younited Credit teamed up on jointly launching “Pass Flash TPE”, a financing project addressing Breton SMEs.

• This local service would make it possible to lend up to €10,000 to small businesses helping them afford immaterial investments and finance their working capital.
• Repayment term: 4 years
• Targets: Breton SMEs over three years old and hiring up to 9 employees.
• These loans are granted for free. They may come in addition to existing, larger loans.
• Supporting documents: balance sheets for the past two financial years to assess their financial health and creditworthiness.
• Customer process: full-digital, even if banking branches from Crédit Mutuel de Bretagne are supporting the offer.
• Following this local rollout, “Pass Flash TPE” would be implemented nationwide.

KEY FIGURES

• September 2019: beginning of the test phase
• More than 20 companies have already been granted loans
• Max repayment term: 4 years
• Rates not specified but preferential costs apply with help from the Brittany region.

CHALLENGES

• Customer acquisition. In the National Institute of Statistics and Economic Studies' assessments (INSEE), SMEs account for roughly 2/3 of all French companies. Despite its local reach, this project could profit from the size of this market.
• Supporting the local economy. Even if a nationwide rollout is considered for “Pass Flash TPE”, they will still aim at supporting SMEs and their employees at local scale.
• Expanding the Credit-as-a-Service model. Younited Credit provides their partners with services from their platform as white-label offers.

MARKET PERSPECTIVE

• Through taking part in the “Pass Flash TPE” project, Crédit Mutuel stresses their strategic focus on supporting SMEs and start-ups. Over the years, this long-term strategy led the banking group to announce several equity investments in FinTechs (Pumpkin in 2017, for instance).
• “Pass Flash TPE” also materialises a partnership announced early this year between Younited Credit and Bpifrance.