Preapproval is YouLend's most seamless customer journey, it can be offered by partners as either the only solution available to their merchants - or alongside a prequalified journey. For more information on prequalification vs preapproval please contact us.

The Preapproval API allows YouLend partners to generate funding offers in real time for your merchants, based on their anonymised payment data.

Based on this payment data, YouLend can generate firm offers which are subject to credit and KYC checks.

Overview

The typical flow using this journey is as follows:

1. Partner regularly sends anonymised sales data

Submit anonymised payment data for all eligible merchants to YouLend via the Generate preapproved offers endpoint. The sales data should be aggregated daily, see below for an example request.

📘
Good to know
Offers are valid for 30 days and we suggest requesting fresh offers for a preapproved merchant every 30 days. You can retry more often for merchants that do not have an existing preapproval, most partners choose weekly or fortnightly

Request example snippet

{
	"thirdPartyCustomerId": "1235-ASC-341",
	"companyType": "SoleTrader",
	"merchantMcc": "1234825",
	"countryISOCode": "GBR",
	"variableFactorRate": true,
	"regularIncrementTypeForOfferGrid": "LoanAmount",
	"paymentData": [
    {
        "date": "2024-02-10T16:16:51.154Z",
        "amount": 1989,
        "paymentType": "Settlement",
        "currencyISOCode": "GBP"
    },
    {
        "date": "2024-02-11T16:16:51.154Z",
        "amount": 1810,
        "paymentType": "Settlement",
        "currencyISOCode": "GBP"
    },
    {
        "date": "2024-02-12T16:16:51.154Z",
        "amount": 1352,
        "paymentType": "Settlement",
        "currencyISOCode": "GBP"
    }
  ]
}

👍
Best practice
Make sure you pass through >6 months of payment data and >1 transaction in the past week in order to pass the paymentDataValidation

2. YouLend return offers in the API

If the merchant is eligible for Preapproval, YouLend will use their credit risk model to provide offers for merchants, these offers will be returned in the response via the same Generate preapproved offers endpoint.

Response example snippet (offers provided)

{
    "merchantIsEligibleForPreApproval": true,
    "paymentDataValidationResponse": {
        "paymentDataValidationSuccessful": true,
        "paymentDataValidationsRulesNotMet": []
    },
    "renewalsValidationResponse": null,
    "preApprovedOffersModel": {
        "thirdPartyCustomerId": "1235-ASC-341",
        "preApprovalId": "f590c011-e5b3-4d7d-851a-7f09183c4dec",
        "interval": 500,
        "regularIncrementTypeForOfferGrid": "LoanAmount",
        "offers": [
            {
                "offerId": "3dd3ea35-4e1a-4240-a260-3e9bde015c85",
                "fundedAmount": 1000,
                "originalAmount": 1135,
                "currencyISOCode": null,
                "factorRate": 1.134,
                "sweep": 0.5,
                "daysUntilRepayment": 174,
                "daysUntilMaturity": 261,
                "expirationDate": "2025-02-13T00:00:00Z"
            },
            {
                "offerId": "683a3f1d-55a2-4867-a6ad-89e2ef7206f9",
                "fundedAmount": 1000,
                "originalAmount": 1145,
                "currencyISOCode": null,
                "factorRate": 1.144,
                "sweep": 0.5,
                "daysUntilRepayment": 175,
                "daysUntilMaturity": 262,
                "expirationDate": "2025-02-13T00:00:00Z"
            }
          ]
    }

📘
Good to know

The response will include a preApprovalIdwhich needs to be included in the POST request to the Create a lead endpoint in order to link the Preapproved offer to the merchant application

These offers are valid for 30 days

Some merchants won't be preapproved - depending on your solution, YouLend can return prequalified offers in a preQualificationOffersModel for merchants which are eligible. Visit Introduction to Onboarding to learn more about the application process for Prequalified merchants

3. Partner present these firm offers to merchant

Partners present these offers via their usual marketing channels - typically in their in their website and apps as well as in marketing emails.

👋
Get in touch
Please reach out for best practices of how to present these offers to your customer base

4. Merchant chooses an offer, application is created via API

Once the merchant chooses an offer in your UI. Send a POST request to the Create a lead endpoint including the preApprovalId found in the response to the Preapproval request.

The partner will also need to provide all relevant business and significant persons data in order for YouLend to complete automated bureau and KYC checks to confirm the offer.

Finally, you can inform YouLend that a merchant has accepted an offer by sending a POST request to our Accept a loan offer endpoint. After this endpoint has been called, YouLend will generate a contract for the merchant to sign (typically within seconds).

Relevant endpoints

Endpoint	Description
Create a lead	Send basic business data to YouLend so underwriting can be completed. The `preApprovalId` will need to be provided in this in request as an additional parameter.
Update significant persons	Submit significant persons details to receive offers subject to KYC.
Submit account information	Partners can use this endpoint to submit merchant bank account details directly to YouLend. This is the account that YouLend will fund to.
Submit stage 1 of the onboarding process	Once the business information is gathered, the lead can be submitted to YouLend using this endpoint.
Accept a loan offer	You can inform YouLend that an offer has been accepted via this endpoint. There will be a unique`offerId` associated with every offer returned in the Generate preapproved offers endpoint. Please note that offers are valid for 30 days. YouLend will generate an electronic contract once this endpoint is called.

5. Merchant signs contract

Partners can choose to embed the contract signing phase within their UI via the instant signing endpoint, or rely on YouLend to send contracts to the merchant email addresses via Docusign.

📘
Good to know
Instant signing is only supported in certain geographies, please speak to your implementation manager about what is available for your solution. Below is an indicative example

i) Instant signing (clicksign) flow

👍
Best practice
This is the recommended option for a seamless signing journey (UX)

Enable merchants to review the contract associated with YouLend's offer, and to sign it. There are two endpoints associated with this step:

Retrieve the documents to sign for the lead

The response will include the financial documents ("contracts") that YouLend require the merchant to sign before financing the merchant.

Example `200` response

[  
    {  
        "id": "93c43433-d749-4c05-804a-c67462dc003e",  
        "name": "Test Name TA Test Company Limited - Receivables Purchase Agreement.pdf",  
        "document": "JVBERi0xLjQKJdPr6eEKMSAwIG9iago8PC9DcmVhdGlvbkRhdGUgKEQ6MjA",  
        "documentType": "Loan Agreement"  
    }  
]

Sign documents via 'instant signing'

Send a request to this endpoint to inform YouLend that the merchant has signed the contract within your own UI.

🚧
Be aware
Using this endpoint requires approval from YouLend. There are certain requirements you'll need to meet for (a) how the signing flow is presented to the user, (b) how you manage logins and permissions, and (c) what YouLend require to be passed as the verificationId
In some geographies and scenarios more than one document needs to be signed - these are done via the same endpoint

👋
Please get in touch
If you would to learn more about who can sign a Loan Agreement, please get in touch via your implementation manager, or via partnershipmanagement@youlend.com

ii) Docusign flow

If the merchant is not eligible for instant signing, YouLend will instead send a contract via to the merchant to review and sign. This process is handled completely by YouLend, and requires no technical work from the partner. This ca

👍
Best practice
We recommend subscribing to the Contract sent ONB10038 and Contract signed ONB10022 webhook event codes to keep track of what steps the merchant has completed. See our webhook events guide to learn more about this

Once the contract has been signed, the partner will need to send a POST call to the partner funding approval endpoint, to notify YouLend that you have approved funding for this lead.

6. YouLend confirm credit decisioning and fund merchant

The merchant will now undergo credit and KYC checks with YouLend. In edge cases, application pushbacks can occur which you can learn more about here.

Once the merchant has been approved, the funding will be sent to the details provided in the Submit account information endpoint, provided here.

For the next steps in the preapproval flow, we'd recommend viewing our Split at source repayments guide.