CRED is arguably the hottest firm in the Indian start-up ecosystem. Founded by Freecharge founder Kunal Shah (also touted as India’s Elon Musk), CRED’s positioning to their customers is that it rewards them for paying credit card bills using their platform.
Remember all those adverts with the likes of Anil Kapoor, Bappi Lahiri, Madhuri that ended with “Let’s just do a simple voice over: Download CRED”? Yes, the same CRED.
CRED’s mobile application boasts of a state-of-the-art interactive UI. Personally, I feel that the application’s UX is the best among Indian product start-ups and comparable directly with the likes of UBER.
So how does it all work?
The customer uploads their credit card details on the application. Now you can pay the credit card bills via CRED’s application and receive CRED money (points) of the same amount in return. You can use these points for participating in lucky draws, shopping and playing various games on the application. Additionally, CRED also nudges the user on during their credit card billing cycle to pay for the dues and avoid interest charges.
What is in it for CRED?
Short answer: User’s financial data. Basically, CRED has details about the user’s payment behaviour and over time, the user's payment history. This includes details like outstanding Credit card amount at any point in time and user’s regularity in paying them out. Essentially, CRED will be in a position to give you a credit rating (like CIBIL score). Hear me out as I tell you why this is priceless.
Imagine a scenario where you go to SBI bank for a car loan. SBI does in person KYC and gives you the loan at some interest percentage x% and asks you for a collateral to proceed the loan. This process takes 15 days give or take. Even after that, there are say y% chances of the borrower to default and not pay back.
Now CRED comes into the picture. CRED promises SBI that the bank doesn’t need to do any in-person KYC and can give the loan to the borrower simply by fetching his/her latest credit rating powered by CRED. There’s no collateral. The loan can be processed in minutes. Guess the default changes? Yes, <<y%. This is a win-win for SBI and CRED.
CRED can also start lending money to their customers on varying interest % depending on the user’s credit history. They can earn the interest as revenue. Their direct access to user’s financial data gives them an edge over other start-ups in this space. Moreover, they’ve already done various collaborations with brands in hospitality and fashion industry and sell their goods on their platform. They allow the user to pay some part of the amount using CRED points.
CRED is taking huge strides in the exponentially growing Indian Fintech space. They’ve quickly grown into a firm valued at $800 Mn. There are rumours that they’re planning to raise more money at $2Bn valuation soon. With a dynamic leader at the helm and a strong customer base of 30 lakh+ users with 750+ credit score, CRED is set to be a pioneer in this industry soon.
Now from a product perspective, the user journey is supreme because of the high quality UI/UX. They have a lot of games and luck draws that help increase the average session time on the application. There are new products/services available to shop in their store very often which increases the number of times the user opens the application.
There are lucky draws with prices like Mercedes Benz that keep the user excited about the application. Basically, they’ve ensured that although paying credit card bills is a once in a month phenomenon, the user opens the application much more frequently than that.
Personally, I’m also a big fan of their marketing. Apart from the catchy-TV adverts and showcases on airports, they’ve also roped in just the right influencers for spreading the word. The biggest names in Indian comedy world are associated with CRED- a lot has to do with the CEO’s social presence (specifically on Linkedin). The user growth goes on to show that they have a very clear understanding of the user personas of their existing and potential customers.
Are you a CRED user? How has your experience with the application been?
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