PragmaGO acquires Romania’s micro lender Telecredit

By Gloria Methri

PragmaGO, a non-bank provider of SME finance in CEE, has commenced its international expansion from the Romanian market by acquiring an 89% shareholding in Telecredit IFN (which operates under the brand name Omnicredit).

The deal was signed with investment company Reconstruction Capital II Limited (RC2) and Elisa Rusu, Telecredit’s CEO, for an initial consideration of EUR 5.785 million plus an earn-out of up to EUR 0.445 million. The transaction is subject to Romanian foreign direct investment authority approval, RC2 shareholder approval, and several other conditions precedent.

PragmaGO provides financing to SMEs in the form of factoring and loans, mainly through embedded finance (BNPL and Merchant Cash Advance)—services that are directly integrated into the ecosystem of partners (e.g., marketplaces). Embedded finance is characterised by scalability and an automated risk management system.

For example, Merchant Cash Advance estimates an individual merchant’s pre-financing limit based on, among other things, sales in the partner’s environment. Repayment can be made in installments or as a percentage of turnover.

In 2023, the company’s portfolio value exceeded EUR 70 million, and PragmaGO had 17,000 (+25% y/y) active clients in Poland. At the end of the first half of the year, PragmaGO’s turnover was PLN 1.15 billion, an increase of 25% year-on-year.

Romania, which shows significant growth potential in the SME financing sector, is PragmaGO’s first step in international expansion. Over the next three years, the company plans to enter several markets in Eastern and Western Europe.

Omnicredit, which also provides non-bank financing to SMEs, has been growing dynamically for several years. Specialising in digital factoring, the company’s receivables portfolio amounted to EUR 6.4 million at the end of 2023 (+54% y/y).

In the first half of this year, Omnicredit has already achieved a turnover of EUR 28.5 million, representing growth of up to 90% compared to the same period last year. Its receivables portfolio has grown to EUR 8.2 million throughout 2024.