Cred establishes a basis on which life can be made more orderly and structured. It allows credit cardholders to pay the bills via an app and awards them with incentives in the form of Cred coins and gems.

How did Cred go from a loss of 378.89 crores to joining the unicorn club
How did Cred go from a loss of 378.89 crores to joining the unicorn club

Kunal Shah established CRED in 2018; by 2021, it had boarded over 5.9 million users and handled around 20% of all credit card bill transactions in India. CRED, according to Kunal Shah, is a TrustTech firm rather than a FinTech, and his motivation for founding it stems from the need to address trust issues in Indian society, which he believes is critical to economic growth.The software also notifies users if their credit card has been debited with any unexpected fees and charges. Furthermore, the CRED app alerts users to any upcoming transactions. CRED is a useful software for keeping a record of credit card expenses. CRED has some major investors on board, and whereas most platforms in India are focusing on growing their user numbers, CRED is clinging to a members-only strategy that demands a good credit rating to qualify for CRED’s advantages and awards. CRED is delighted with its brand rewards partnerships, which include well-known brands like Myntra, Ajio, Samsung, Dineout, Cure. fit, and many others.

How did Mr. Kunal Shah get this brilliant idea?

 He understands the advantages of “a frictionless environment – an environment that promotes financial progress for its citizens.”  According to his post, “…people trusted the system because the system consistently rewarded good, trustworthy individuals. But back home, trustworthy individuals kept paying a price for the actions of others.” Worse, the absence of clarity and data disparity that prevailed at home meant that maintaining the trust was pointless. “There are over 30 hidden charges and high interest costs that haunt you even if you pay a single rupee less than your complete payment,” he writes in the essay. The existing system loves when you make a mistake. It wants you to make mistakes. For far too long, the system has taken the good guys for granted. Consumers with a good credit history are entitled to more.” That is exactly what CRED is all about.  As Kunal puts it: “I felt the need to create a system that rewards trustworthy and creditworthy individuals of India and inspires others to be like them.”

Investors & funders behind growth of Cred

Cred has been steadily increasing over the years. Being a startup launched in 2018, it reached the unicorn club on April 6, 2021, when it closed its $215 million Series D investment. In a statement issued in April 2021, Kunal Shah stated that CRED controls “22 percent of all credit card payments in India on a monthly basis.”  When entrepreneurs want to develop their product or service, grow into a new product category, or extend into a new area, they’ll need startup finance.Over the course of its eight investment rounds, Cred has raised a total of $722.2 million in funding. On October 19, 2021, the firm witnessed its most recent Series E investment round, which was co-led by its previous investors, Tiger Global and Falcon Edge, and was worth roughly $251 million. Other investors in the Series E round of funding included DST Global, Insight Partners, Coatue, Sofina, RTP, and Dragoneer. Meanwhile, Cred has introduced two new investors to its portfolio: Marshall Wace of London and Steadfast Venture Capital. 

Cred’s smart business model

The company’s business model is divided into four sections:

  • The Cred app – The Cred app is a nice-looking, well-designed app that consumers can access if they want to glance at the offerings accessible after paying their credit card bills. They may effortlessly sign up for the app and view all of the deals available to them.
  • Business owners which provide deals on the app – Cred users can access a variety of offers from a variety of businesses. CRED accomplishes this by bringing businesses on board and collaborating with them. It is a major boon for CRED and its clients, who can take advantage of the companies’ special deals. It is also a huge win for the businesses. This is because they, too, profit greatly from the increased visibility.
  • Clients that clear their credit card bills – CRED is also a convenient and beneficial system for those who pay their outstanding bills using it. End-users can use CRED as an application to pay their credit card bills and receive several offers and benefits, as opposed to financial institutions or other apps. Consumers that appreciate the app, on the other side, share CRED with their family members and friends.
  • Cred Mint – On August 20, 2021, Cred announced a new tool called Cred Mint, which is a peer-to-peer borrowing network that allows Cred users to lend their spare cash to creditworthy users. It’s a rather open procedure that only allows Cred members with a minimum credit score of 750 or higher to become borrowers. Moreover, the lenders can take their money at any time using the interest that has accrued during the period.

Profit modal that assist cred ap in joining the unicorn club

Cred makes money in two ways: one is through advertising and the other is through subscriptions. Cred, as we all know, lists a wide range of products and deals that assist its users from a variety of enterprises. Cred charges these firms a fee for their exposure. Cred earns money every time a user takes advantage of the offers. Cred collects financial data from consumers who are using the system to pay their bills and other transactions. Cred has other investment banks that pay them a charge for accessing this data, in addition to providing Cred with the chance to propose more offers to their subscribers utilising these data. These businesses, banks, and investment firms would ultimately engage potential clients with their own line of products that were customized to their preferences.

Cred app’s current state and future

With the COVID-19 pandemic came plenty of new issues, thus CRED created CRED RentPay and CRED Cash to help members better manage their money and credit during these trying times. CRED has consistently grown to over 5.9 million users, with the company claiming to handle over 20% of all credit card bill transactions in India. CRED aspires to be a valuable community where members can establish engagements and relationships with one another in the future. It is attempting to create a digital club of people with excellent credit scores and access to their previous spending habits. It has developed effective tactics for retaining its customer base and for forming strategic collaborations with other major companies in the sector and across industries. They have contributed to an increase in sales for the brands linked with them throughout the course of their two-year trip. They’ve also put a lot of effort into data security. It is, however, critical for them to overcome the problems of increasing their presence to lower-tier cities while retaining greater customer service.