Hi from Berlin,
I'm testing something new. If you are subscribed to the payments or banking editions, you've seen a sponsor right after this intro in past editions. Since not every edition has a sponsor, I'm wondering if I can use that space differently. At the same time, I am still trying to figure out how to monetise the EFR newsletter so I can spend more time on it (and keep it free).
All of this brings me to my new segment called Friends of EFR. It features people and companies from my network that I've known for a long time and trust. I feature them here, and instead of a paid sponsorship, I may receive a referral fee if an introduction leads to something.
And to kick it off, the first friend is an unusual one: me. The reason is that multiple companies (but not competitors) are behind this question, and I cannot share their offering (yet). Sounds mysterious? Read below and get in touch. And don't worry, in the next editions you will see actual Friends of EFR ;-)
Now let's dive in.
Friends of EFR
Over the past weeks, I've had several conversations with platforms asking the same question: what's the right way to offer lending to our customers? Some don't offer lending yet; others want to rethink their setup. There's no single right answer. It depends on volume, data, funding and risk appetite. I recently connected with a few companies that help platforms build the right setup. I can't name them here (yet). If that question is on your table, reply to this email, and I will share their pitch with you. And if you're interested, I can make an introduction (and may receive a referral fee).
Embedded Lending News
SIDES puts Stripe Capital inside its restaurant software: The Berlin restaurant and delivery software provider now offers growth financing to German restaurants that take payments through SIDES Pay. Eligible restaurants see a personalised offer in their dashboard, pay a fixed fee instead of interest and repay automatically as a share of daily card sales, with Stripe as the financing partner. Tying the loans to SIDES Pay lowers the risk because the company sits in the payment flow, and I expect it also nudges restaurants to move their payments over. What I find more interesting is the competition: Lieferando, Wolt, Deliveroo, Nory and allO all offer restaurant financing. Which provider can offer the best rates will also depend on how much of a restaurant's revenue runs through each platform. (Read the full story)
Skroutz and Bolt embed lending with finmid: Greece's largest online marketplace now lends to around 9,000 of its merchants, and for the first time in a finmid partnership the platform puts up the capital itself, while finmid handles underwriting, servicing and refinancing. Bolt's fleet operators can finance vehicles through finmid over up to four years and own them after the last instalment. Both launches came with finmid's €17m raise, bringing total funding to €52m. With a car as the asset, the Bolt programme is a different kind of product from the short merchant cash advances I see often in the market. (Read the full story)
Sainsbury's Money launches loans and savings with NatWest Boxed: The supermarket's financial services brand now offers personal loans of £1,000 to £35,000 and an instant access savings account, both with better rates for Nectar members and both running on NatWest Boxed. Sainsbury's used to run its own bank, but it sold the loan, credit card and savings books to NatWest and handed back its banking permissions, keeping the brand and the customer relationship. So is it embedded finance? Maybe. But it's definitely more than the NatWest Nectar credit card due later this year, a classic co-brand. For me, the real test is whether Sainsbury's brings these products into the Nectar app and prices them on shopping data. Tesco went the other way: Barclays bought Tesco Bank and now runs it under the Tesco name. (Read the full story)
Stripe to acquire Parafin, the lender behind Toast and DoorDash: The US embedded lender lets software platforms offer cash advances and loans inside their own dashboards and says it has funded over $3bn for more than 60,000 small businesses. Stripe already competes in the same space with Stripe Capital for platforms, so I see the deal as part capability, part removing a competitor. Both sides say Parafin will keep supporting Stripe's rivals, but I expect Stripe to make its own payments the more attractive option over time. YouLend is the one to watch: it powers Stripe's US Capital merchant cash advance for platforms and competes head-on with Parafin. (Read the full story)
Done.ai brings BNPL to Finago invoices with Nordiska: The Nordic business software group, formerly 24SevenOffice, has launched buy now, pay later on business invoices inside Finago, which it says makes Finago the first ERP system in Norway to offer it. Suppliers get paid in full upfront, buyers pay over up to 36 months, and BankID approves the application in minutes. Nordiska, the Swedish credit institution behind SAS's new business card, provides and carries the credit, while Done.ai earns fees on volume without taking credit risk. It is the first launch under the three-year exclusive deal the two signed in January 2025. (Inderes)
Froda enters France through Shine: The Swedish embedded lending provider has entered France, its eighth European market. Its first partner there is Shine, the French business account for freelancers and small businesses with around 200,000 users. Shine's customers get loans in the app, assessed on their banking data and paid out the same day, with European Investment Fund guarantees behind the pricing. What I find interesting is how Froda got in: Shine sits in the same group as Kontist in Germany and Billy in Denmark, where Froda already runs lending, so France is its third market inside the same group. For Froda, it is a way into new countries by following one platform group across borders. (Finextra)
FedEx plans growth financing for its small business customers: The logistics group wants to offer funding to small and mid-sized business customers through Stripe Capital, with the first product planned for early 2027. Instead of relying only on bank statements and credit scores, the underwriting will also look at how a business ships through FedEx: shipment activity, inventory movement and fulfilment performance. I expect this helps online sellers that ship a lot but look thin on paper to a bank. It is still open what the money can be used for, whether stock, shipping costs or general working capital, and whether customers will apply inside FedEx's own tools. (FedEx)
Foodics invests in its lending partner Funding Souq: The Saudi restaurant operations platform, which says it has processed more than 6 billion orders, has made a strategic investment in Funding Souq, the Saudi and UAE SME financing platform behind its Capital 2.0 product. Funding Souq brings the regulated financing and credit expertise and underwrites on Foodics merchants' real-time sales data, which the two call Saudi Arabia's first fully automated business loan. Foodics plans to deploy $100m through Capital 2.0 in the first year. So instead of only plugging in a lender, the platform now owns a piece of it. (Funding Souq)