Qonto and Pennylane are two of France’s most well-known fintech disruptors. The Paris-based fintechs set out to disrupt particular areas of finance: Qonto- SME banking; and Pennylane- accounting software for SMEs.

Qonto, founded in 2016, four years before Pennylane, is the bigger name in France, yet Pennylane is fast-rising. Backed by the likes of Sequoia and Tiger Global, both have hoovered up hundreds of thousands of customers.  

In the European SME market, the fintechs are now friends and foes- each is integrated with the other’s services, so users can sign up for both services, yet they also compete for customers as they have expanded to offering all-in-one financial and accounting products.  

Tech.eu spoke to executives from Qonto and Pennylane to get a progress report on their respective fintechs and ask whether they saw themselves as competitors.  

Qonto  

Qonto boasts more than 600,000 SME and freelance customers across Europe, where it takes on incumbent financial players.

On top of its core business banking offering, it now offers SMEs and freelancers corporate cards, bookkeeping tools, expense management and short-term financing in a single hub.

Its focus is on the EU market, operating across France, Germany, Italy, Spain, the Netherlands, Belgium, Portugal, and Austria.

It was last valued at $5bn in a 2022 $552m funding round, led by Tiger Global and TCV. 

Qonto, which is full-year profitable, makes around half its revenues through monthly fees, such as subscriptions, and half through net interest income.  

Philippine Rougevin-Baville, Qonto’s managing director for Western Europe, says Qonto runs an 80-20 model, which means that 80 per cent of the product is the same in each market it enters, with a 20 per cent difference.  

Rougevin-Baville says Qonto’s application for a French banking licence, which it applied for last year, is “making good progress”.

She says Qonto has had “positive feedback” from the regulators and is hoping to get the green light within six months.  

If successful, it will allow Qonto, which currently operates under a Payment Institution licence, to offer its own credit products, such as lending. 

Qonto has hitherto made two acquisitions: German rival Penta in 2022 and accounting and financial automation platform Regate in 2024.

Rougevin-Baville doesn’t like comparing Qonto to Pennylane, pointing out they are “very, very different players”.  

For example, she points out they have different customer acquisition strategies: Qonto direct to SMEs, Pennylane to SMEs via accountants.

She says: “We have a tendency because we are smaller players to compare against each other. But the reality is that each of us is addressing a bigger market, which is going after traditional players.”

However, the two fintechs do compete against each other and are going head-to-head as they compete for business when mandatory electronic invoicing for B2B transactions comes into force in France in September.  

Rougevin-Baville says: “E-invoicing is a key topic for France in particular. But it’s also coming across other markets, so we are very much focused on that.”

On the biggest challenge facing its customers, Rougevin-Baville says: “I guess it’s everything related to cash flow. They like visibility. All of that is an immense playground for us to play in.”  

On the potential threat to Qonto from a new wave of fintechs, she said: “For us, being positioned on the banking side, which is a regulated industry, we are seeing fewer threats compared to the SAAS players.”  

On the agenda for the rest of the year, along with the expected banking licence and the new e-invoicing rules, Qonto will also be investing in markets outside its native France, says Rougevin-Baville.  

Pennylane  

Pennylane, founded in 2020, has extended beyond offering SMEs and accountants accounting software into offering business bank accounts, via banking-as-a-service provider Swan.  

It now sells itself as an ”all-in-one” accounting and financial management platform which centralises the financial function of businesses and their accountants in one shared workplace, enabling them to work closer together.

Pennylane says it has more than 800,000 business customers, with around 90 per cent of them coming via accounting firms, according to co-founder and CEO Arthur Waller.

It operates in a French software market for accountants and SMEs that is fast consolidating, with “super-app” competitors on the rise.    

For example, US private equity firm Silver Lake has made several investments in the market.  

Earlier this year, Pennylane raised $200m at a $4.25bn valuation, in a round led by TCV with Sequoia and CapitalG also participating. Waller says Pennylane didn’t need the funds.  

He said: “We want to be in a position that we can sit at the table, so that if there is someone we would like to buy, to just be credible. You need to have hundreds of millions in the bank to sit at the table.”

Waller, who is a fan of Qonto, says Pennylane is both friend and foe to Qonto.

He says: “We both have a really good integration. It’s probably the bank we are best integrated with. But at the same time, around three years ago, we also started offering our own bank account to our users.”  

Last year, Pennylane launched in Germany, its first overseas market, where it is “still very early days” but there is “lots of demand”, says Waller.  

Waller says another difference between Pennylane and Qonto is localising the product in different markets, saying it can take Pennylane up to three years to localise the accounting part of the tech.  

He says: “Localising for a new country is much, much harder for us, as we are rebuilding the tax, so it is more to localise than just a bank account.”  

On the new e-invoicing rules, Waller says: “There is obviously a battle between banks and accountants to equip their accountants with that operator.”  

On the challenges facing its customers, he says: “What we are trying to solve is to give the real-time visibility on their finances and trying to make admin easier. We have lots of complex admin.”