European provider of digital trade credit solutions, Hokodo, has partnered with AI powered transaction analytics firm, Fuse. Hokodo says that the collaboration will enhance its credit offering to businesses in the UK.

The partnership gives businesses access to more personalised credit options. This results from combining Fuse’s credit risk and income verification tools with Hokodo’s B2B lending capabilities.

Using Fuse’s tools, Hokodo offers finance options to businesses previously excluded from credit. Examples include sole traders, who are often not scored by traditional credit bureaus and therefore struggle to access credit. ONS figures indicate that there are more than three million sole traders operating in the UK alone. This highlights the scale of the micro-business finance market.

By utilising customer income verification via Fuse’s innovative tools, Hokodo has streamlined the process for existing customers to expand credit lines by analysing repayment patterns on previous loans.

Hokodo acquires European payments licence

Recent figures from the Federation of Small Businesses suggest that demand for business finance is set to increase. Some 81% of finance brokers expect a rise in demand over the next six months. However, 84% also said that high street banks were reluctant to lend to SMEs.

Hokodo became the first B2B BNPL provider with a full European payments licence when it acquired a Lithuanian payments business. Hokodo says that this is a vital step in its journey to improve B2B payment options across Europe. Hokodo is now available in seven of Europe’s largest markets with expansion fueled by last year’s $40m fundraise to enable one million businesses to access a better way to pay by 2025.

BNP Paribas, Citi, Mangopay, Lemonway partnerships

Over the past several months, the B2B lender has announced a number of key partnerships. These include collaborations with BNP Paribas, Citi and payment service providers Mangopay and Lemonway.

Hokodo is the latest lender to partner with Fuse to enhance its credit decision-making. Other partners include education lender, Knoma, which selected Fuse as its Open Banking partner.

Sho Sugihara, CEO and Co-Founder of Fuse, said“Hokodo is shaking-up the B2B payments space. It is providing businesses with alternative credit options and we’re proud to support this mission to improve the business finance market. By utilising AI transaction analytics, Hokodo can now unlock access to additional funding streams for thousands of businesses. And support groups such as sole traders who are typically excluded from mainstream credit options.” 

Nicolas Rabinovitch, Director of Data Science & Fraud at Hokodo, added: “Fuse provides us with the Open Banking data we need to make better risk decisions, offer credit to more buyers and understand buyer behaviour in a B2B context. We are now offering sole traders another path to get approved. Fuse is helping to support these risk decisions. Ultimately, this empowers a greater number of small and micro businesses to access the credit they deserve.”