French startup Lydia is announcing a new partnership with Younited Credit, which lets you borrow anything between €500 and €3,000 and pay back within six to 36 months. The feature will be released in France at some point during the summer.
This isn’t the first time Lydia is playing around with credit. The company already partnered with Banque Casino to let users borrow between €100 and €1,000. But that feature was limited to short-term credit as you had to reimburse everything over three installments.
This time, you can borrow more money and you have more time to pay back your loan. Lydia will try to be as transparent as possible when it comes to interests. And there’s no fee in case of early repayment.
Compared to the first credit product, you can’t borrow money instantly. You apply for a loan in the app and get an answer within 24 hours. If you accept the offer, you have seven days to change your mind — it’s a regulatory requirement in France. You then receive money on your account.
By offering two different credit products, Lydia wants to cover more use cases. If something unexpected happens (your laptop broke down, you have to book an emergency flight, etc.), you can borrow as much as €1,000 in just a few seconds.
You receive the money on your Lydia account and you can start using it instantly using a virtual card, Apple Pay, Google Pay, Samsung Pay, Lydia’s debit cards or Lydia’s peer-to-peer payments.
Fees on instant credit lines are pretty high as you pay 3.13% in interest and a one-time fee of €6.90 to €19.90 to receive the money instantly, depending on how much you borrow.
If you’re planning a big purchase but you can wait a week, you can go through the new credit offering with Younited Credit. This isn’t the first time Younited Credit has offered an integrated credit product with another fintech startup. For instance, N26 also offers credit lines with Younited Credit in France.
Lydia started as a peer-to-peer payment app with 3.5 million users in Europe. It recently raised a $45 million funding round led by Tencent. The startup now wants to build a marketplace of financial products. And integrating Younited Credit in the app seems in line with that strategy.