Fractional payments: La Banque Postale changes tactics

9 months ago, La Banque Postale announced that it had partnered with French fintech Alma to offer its customers a fractional payment solution. However, due to a lack of agreement, La Banque Postale has had to reconsider its plans: it has changed tactics and turned to another fintech, Pledg, and is now preparing to launch its own solution.

Fractional payments, the "antechamber of consumer credit

Last July, La Banque Postale lost out to BNP Paribas, which won the bid and took over Floa Bank, the banking subsidiary owned 50% by Crédit Mutuel Alliance Fédérale (CMAF) and 50% by the Casino group. The acquisition of one of France's leading fractional payment players had cost BNP Paribas 258 million euros.

Aware of the importance of fractional payments, considered by its CEO Philippe Heim as " the antechamber to consumer credit ", La Banque Postale had not given up on offering such a solution to its customers.

To this end, last summer it set up a partnership with French fintech Alma, to offer its merchant customers - whether they own a store or are e-commerce specialists - payment solutions in 2, 12, 24 or 36 instalments.

La Banque Postale partners with Pledg

However, the partnership failed to find common ground between the two parties, with Banque Postale wishing to impose its brand to the detriment of Alma's.

For the subsidiary of La Poste, whose parent company is in contact with virtually all e-merchants in France through parcel delivery, promoting its brand through a fractional payment solution is essential to ensure visibility among the 200,000 merchants concerned.

On the other hand, the deal did not benefit fintech Alma, which is keen to develop a close relationship with retailers, as is fintech Klarna, which is also working to develop its brand.

This divergence of vision led Banque Postale to turn to Pledg, the second French fintech to occupy the fractional payment market alongside Alma. Unlike Alma, Pledg offers its fractional payment solution as a white label, enabling the Banque Postale subsidiary to maintain its proximity to merchants.

La Banque Postale has announced this new partnership as it embarks on an ambitious diversification and modernization plan. According to Philippe Heim, the bank is already measuring " the fruits of this transformation, which carries ambitions and convictions ", he said at the presentation of the 2021 results, estimating that the model " continues to be more diversified and more digitalized ".

In 2021, the Group's net income, excluding the CNP Assurances purchase price adjustment, will amount to 1 billion euros, and its sales, at 8.2 billion euros, will be up 6%.