With more than six months behind schedule, Orange Bank is launching an “Express Loan” offer in partnership with French fintech Younited, which specializes in consumer credit and personal loan solutions.
The neobank hopes so “extend your business to new customers”, as this new offer is open to customers who do not have a bank account with Orange Bank, thanks to Younited’s open banking technology, which allows you to synchronize the bank data of other establishments. This is also what allows a response to the credit request in 5 minutes on average. Funding ranges from 1,000 to 75,000 euros.
profitability in 2024
The expansion of its customer base is a necessity for Orange Bank, whose future in the telecommunications group is uncertain. The operator, who bought the shares held by Groupama in the neobank in October 2021, without finding another buyer, recapitalized its subsidiary at the same time for 230 million euros. Orange Bank is losing money, a lot of money. In the first half of 2022, its operating loss was 80 million euros.
The neobank, which has 1.8 million customers in Europe (but some have just taken out multi-risk smartphone insurance), has gained 600,000 new customers since the beginning of the year, and hopes to reach profitability in 2024 according to its annual report. Provided you hold out until then. The new head of Orange, Christel Heydemann, has indeed launched a general strategic review of the operator’s activities, and banking services are far from its core business.
credit, a more profitable product
Orange Bank is far from being an exception among the new banking players: according to a study by the consulting company Simon-Kutcher, only 5% of banking fintechs and online banks in the world have reached the break-even point even In France, Nickel (BNP Paribas) and Fortuneo (Crédit Mutuel Arkéa) are the only players that would be profitable.
Orange Bank has for it, compared to other new banks, the fact that 90% of its new customers subscribe to paid products. The Orange Bank premium account is billed at 7.99 euros per month. It also benefits from synergies with the Orange store network, nearly 70% of account openings are made in business branches, according to an ACPR 2020 report.
The Orange subsidiary emphasizes credit because it is one of the most profitable products. In 2021, it produced almost one billion euros in credit. It also counts in Africa, a continent that has always counted for the telecommunications operator, where the neobank has 700,000 customers.