Société Générale acquires fintech challenger bank

French bank acquires Shine to expand its services to small businesses and entrepreneurs

French bank Société Générale (SocGen) has acquired challenger bank Shine to target small business customers with digital accounts and other online services.

The deal will add to the bank’s fintech ecosystem and will support SocGen’s small business and entrepreneur customers.

According to reports, SocGen paid €100m for the French fintech, which has built up a customer base of 70,000 entrepreneurs in the two years since its launch.

As well as an online business account, Shine offers digital tools to support businesses with administrative tasks such as invoicing and accounting, to allow them to focus on their business and development.

Shine will continue to develop independently, according to SocGen.

Marie-Christine Ducholet, director of retail banking at SocGen, said: “Through the acquisition of Shine, we will be able to offer entrepreneurs the widest offer in this growing, high-value market. Shine’s model appealed to us because it reinforces our relational promise to offer clients the best mix of people and digital technology.” 

Ducholet said the acquisition is part of SocGen’s open banking journey.

SocGen will also market Shine’s offering to its business clients if they prefer 100% online management and low-cost services. When Shine’s clients grow and require additional services, SocGen said it can offer these without customers needing to change banks.

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The bank’s strategy in fintech is to acquire rather than develop. SocGen first acquired a fintech in 2015 when it took over Fiduceo, and has since bought Lumo and Treezor. This experience of integrating traditional and new banking cultures will increase the chances of success in integrating Shine with the business.

When traditional banks acquire challengers, there are cultural barriers to overcome if they are to succeed.

BPCE, the result of a merger of two centuries-old French banks, acquired challenger bank Fidor in July 2016, but after a couple of years, BCPE put Fidor up for sale when things didn’t work out as planned.

At the time of the acquisition, BPCE chairman François Pérol said: “This is a key step in the acceleration of the digital transformation of our group. It further demonstrates our commitment to innovation, to developing a customer-centric approach enabled by digital banking technology, and to being more involved in the digital and mobile banking field.”

However, one source said BCPE never really had a strategy on how to take Fidor forward. This demonstrated the difficulty of integrating two contrasting business cultures.

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