Flowpay Raises $32.7 Million to Grow Embedded Lending Solution in Europe

Czech FinTech company Flowpay raised €30 million (about $32.7 million) in debt financing to grow its embedded lending solution that enables small and medium-sized businesses (SMBs) to access financing through platforms they use every day.

The company aims to expand beyond the three countries in which it operates: the Czech Republic, Slovakia and the Netherlands, Flowpay said in a Wednesday (March 19) press release emailed to PYMNTS.

“This new line of credit from Fasanara Capital allows us to become one of the leading embedded lending solutions in Europe,” Flowpay CEO and Founder William Jalloul said in the release.

The company offers SMBs access to business loans of between €2,000 and €100,000, according to its website.

To apply for a business loan, SMBs connect their partner point of sale (POS) or eCommerce platform with the Flowpay app, select a loan amount and repayment schedule, review the total payment information that is instantly provided, and verify their identity and bank account online, the site said.

After the system evaluates the application, Flowpay will email the SMB a contract and, once that’s been signed, deposit the funds into the SMB’s account, per the site.

Embedded lending is growing in popularity around the world, according to the PYMNTS Intelligence report commissioned by Visa, “The Embedded Lending Opportunity: Global State of Play.”

The report found that across six major world markets, 18% of microbusinesses and small businesses (MSBs) have recently used embedded lending.

The growing popularity of this type of lending is driven by the convenient, streamlined access to financing it offers from within merchant, business and other platforms, per the report.

The ability to better manage cash flow is a clear benefit of embedded lending, as it enables small businesses to manage their cash needs in unpredictable situations, Mathieu Altwegg, head of product and solutions for U.K. and Ireland at Visa, told PYMNTS in an interview posted in October.

Being offered as an embedded option in context and in real time is a marked departure from traditional lending, which tends to be planned in advance and which can be tied to a relatively long approval and underwriting process, Altwegg said.