Cred raises $80 million in Series B funding as valuation almost doubles

Credit card repayment platform Cred has raised $80 million in a round led by existing investor DST Global.

The round also saw the participation of other existing investors Ribbit Capital, Sequoia Capital and Tiger Global, said a person privy of the development.

This is the Kunal Shah-founded startup’s series B round of capital infusion, ascribing a value $800 million to its business.


This marks a significant bump up from the $450 million valuation at which Cred conducted its previous funding exercise of $120 million in August last year. The startup had raised $30 million in its seed round in late 2018.

Shah had also cofounded online bill payment platform Freecharge, which is currently owned by private lender Axis Bank. Cred didn't respond to ET's request for comments late evening Monday.

The startup allows customers to pay their credit card bills in return of discount points called Cred Rewards and has an ecommerce platform called Cred Store. The business model entails a monetisation strategy where the fintech charges its partner business a prescribed fees in return of increased engagements and fiscal discipline.

While the rewards enable engagement, the store is an ecommerce platform that allows for discovery on closing of the transaction. The startup has over 1,300 brands as members, including Samsung, Myntra, and Curefit among others.

During the recent Indian Premier League, the company had launched an aggressive marketing campaign to target credit-worthy customers. It has around three million customers onboarded over the last two years.

“Investors have seen good traction and hence they are leading this round as well,” said a person aware of the development. “It owns the consumer experience and has been able to curate a differentiated digital experience that merchants and financial institutions value. Over a third of members access the platform at least three times a month.”

Read: Who made Bappi Da sing love ballads for credit cards?

Fees from brands and financial institutions that want to target members have helped Cred start monetising. The cited person said investors have seen the traction and are growing increasingly confident of achieving scale.

The ongoing cricket season has also boosted business with new onboarding multiplying over the past months, according to an executive.

The demand for credit cards in India has also picked up in recent months, latest Reserve Bank of India's data indicates. The outstanding credit card debt had contracted by almost 10% in the first few weeks of the coronavirus pandemic as consumer sentiment flatlined.