The 22-year-old told Liverpoolfc.com: "[It is] extremely important - a home game, a great chance at Anfield to really put pressure on Young Boys, get three points and hopefully put us at the top of the group.
"The Premier League gets the majority of the attention, I guess you could say, but as professionals, as footballers, we want to win every competition we can and every game we can.
"We want to go as far in this Europa League as we possibly can and we know Thursday's match is pivotal if we're going to do that.
"If you look at the calibre of opposition in this competition, it's a great challenge. Test yourself against some great players, some great clubs - there would definitely be no shame in lifting that trophy."
When the two sides met in Switzerland in their opening game of the group, an inexperienced Reds side edged an eight-goal thriller 5-3 - a victory Allen believes was a 'massive achievement'.
"They played quite expansively and open, and at times they probably cause defences a lot of trouble," the midfielder said of Young Boys.
"But the positives from our point of view in that game were having gone behind, we came back. To score five goals away from home in a European contest is a massive achievement."
Europa League football has merely whetted Allen's appetite for action, and the No.24 admitted he dreams of showcasing his ability at an even higher level in the near future.
"Any sort of Premiership footballer's dream is to one day play in the Champions League, and it's no different for me," he continued.
"European contest always has great feeling. At Anfield in particular there's that atmosphere you don't experience at many other places in the world. Hopefully I'll get a taste of that one day."
Allen has already racked up 17 appearances in a Red shirt since his summer arrival - and revealed that although he has been surprised to feature so regularly, the constant rhythm of matches is an enjoyable thing.
"When you join a massive club like Liverpool you understand there's extreme competition for every place," he explained.
"It has been a great start for me to get so many games and I've got a massive task on my hands now to try and keep myself in and amongst the team.
"Physically it's demanding, but you try not to think about that. Any footballer wants to play as often as they can and when they can. The quicker the games come, the more exciting and more enjoyable the season - it's great.
"Whatever the result on the weekend, whether it's positive or negative, you're looking straight to the next game to either put it straight or go into that game full of confidence from a victory."