Free Finds New Financial Partner in Younited Credit

Free Finds New Financial Partner in Younited Credit

FACTS

  • As they introduce their Freebox “Delta”, the French telco Free teams up with Younited Credit.
  • This new box started being made available a few days ago. Additional features include: fibre-optics speed up to 10 GB, 4K HDR display, Alexa voice assistant, Devialet soundbox, etc.
  • If interested, Free subscribers may buy it for €480. Two options are proposed:
    • Cash payment or 4 instalments, interest-free
    • An interest-free credit line over 24 or 48 instalments.
  • These instalments come in addition to their Internet subscription.

CHALLENGES

  • Scaling up: This new Freebox appears to disrupt Free’s typical strategy as their first obviously high-end product. This change accounts for its higher price and the companion financing offers.
  • Unlike their previous launches, this box is available for purchase and not for rental so they can feature lower monthly instalments. (Since February this year, the DGCCRF has been requiring that telcos include the cost of renting an Internet box in their commercial offers.)
  • Also unlike previous launches, Free chooses to partner with a FinTech. Younited Credit is well-established on the market for consumer credit. They are famous for their near-instant decisioning, as well as their streamlined, paperless processes. A few months ago, they started enabling their customers to automatically authorise connections to their bank account so they wouldn’t have to send supporting documents. This distinguishing feature might explain why Free made this choice.

MARKET PERSPECTIVE

  • Free already had a partnership in place with Crédit Agricole Consumer Finance on financing smartphones. Their partnership with Younited Credit stresses a strategic shift.
  • Younited Credit keeps relying on partnerships. They first had agreements in place by way of providing their credit infrastructure to financial players (N26, Linxo, ConTe), and they are gaining grounds among telcos in the mobile sector. This said, this agreement stands out as a major announcement for the FinTech.

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