The Embedded Lending Hub for Builders

Usually not. Most non-financial brands launch with a provider who holds the licence, funds the book and services the loans, while the brand owns the interface and the customer relationship. Your own authorisation becomes necessary once you want to set your own credit box, hold the credit risk, or fund the book yourself.

In most partner arrangements the provider does. Some structures ask the brand to take a first-loss slice, which changes the economics, the accounting treatment and often the regulatory position. It is worth settling this question before any other, because most of the remaining decisions follow from it.

From the spread between their cost of capital and what the borrower pays, plus fees. The brand usually earns a revenue share rather than the full spread. The further a brand moves towards holding the licence and the risk itself, the more of that economics it keeps, and the more of the business it has to become.

Transaction or sales history on your customers is the starting point, ideally two years and rarely less than twelve months. Providers also look at how many customers you have, how much of their business runs through you, and whether you control the payment flow, because repayment can then be deducted at source.

With a full-stack provider, roughly a quarter from signature to first loan, with integration work the main variable. Getting your own authorisation takes considerably longer: a payment or e-money institution licence is typically nine to eighteen months in Germany, and a full credit institution licence longer again.

In a referral arrangement the customer leaves your product to apply with a lender who owns the pricing, the underwriting and the relationship from that point. In embedded lending the offer sits inside your product, is built on data you already hold, and the customer never leaves to apply. Referral is distribution, and it is frequently sold as embedded finance.