Alexandre Prot, CEO and cofounder of French fintech unicorn Qonto, has been hitting the road recently — taking to the stage at Gitex Europe in Berlin, Money 20/20 in Amsterdam and VivaTech in Paris.
“It’s very much linked to our European expansion and the fact that we are and we want to be more and more visible,” he told the Sifted Podcast.
The small business banking and financial services company now has 500k customers in eight markets across Europe, helping them do everything from banking to accountancy, lending, savings and as of recently, payment terminals.
Within the year, Prot tells Sifted, the now-profitable company is likely to apply for a full banking licence, “probably in France”.
Doing so would enable it to offer customers longer-term, higher-value loans, savings and investment products — and, it hopes, get it closer to its target of 2m customers by 2030.
The move to banking
Qonto’s on a drive to offer more services to more (and bigger) customers across the EU — and getting a banking licence would unlock a lot of that.
78% of customers use Qonto as their primary account, says Prot — “and so, if we want to increase that further and go up market, serving companies with not only 5, 10, 20 employees but also 30, 50 employees, of course offering more products including financing, savings and investment is important.”
As a payment institution, Qonto can offer short-term financing by leveraging its own funds. It currently offers invoice financing of up to €30k, for less than 12 months. “That’s pretty different from what a fully licensed bank could be doing, because they would be leveraging customer deposits to finance credit lines to other customers,” says Prot.
As a bank, Qonto could run more services independently and, Prot hopes, more speedily; it’s currently reliant on banking partners for things like international payments, loans and payments infrastructure.
“Very recently we built our own card processor, so all the card transactions that are made with Qonto cards are processed internally, which increased acceptance rates and improved product velocity on card products,” he says. “Getting a banking licence would, in the same way, enable us to do more internally, to own more of the value chain and not be dependent on some banking partner’s speed.”
It would be likely to apply for the licence on its home turf, says Prot: “We have a pretty good relationship history with the French regulator. Qonto holds its payment institution licence in France. “They saw us scale and go from 0 to 500k customers […] and know us pretty well in terms of governance. So it would probably be the natural regulator for us.”
Fundraising and M&A
Another huge fundraise isn’t on the cards anytime soon, says Prot; Qonto last raised €486m at a €4.4bn valuation in 2022, at the top of the cycle, from Tiger Global, KKR and Insight.
“We’re profitable, so we don’t intend to be raising additional capital,” he says. “If we were to become a bank, we would also probably not need to raise additional capital.
“So the main, or the only reason why we could raise additional capital is if we do a large or very large M&A deal, paid mostly in cash.”
Prot has previously been vocal about his M&A intentions, and Qonto has made two acquisitions to date: German small business bank Penta, in 2022, and French fintech Regate in 2024. Penta, he says, was a geographical expansion play (“and we’re very happy with that first acquisition” — Germany is now Qonto’s second-biggest market), and Regate was a product and channel expansion move — a way to tap into accountants as a customer group.
“We believe we can get to our goals even faster through acquisitions.”
As for an IPO, “we don’t know what might happen,” says Prot. “Three, five years from now, it might be an IPO — and so we’re just slowly but surely getting ready for that.
“We get some emails, but most of the time we ignore them,” he adds. “There are no short-term plans on IPO’ing.”
Read the orginal article: https://sifted.eu/articles/qonto-banking-licence/
