CRED Forays Into BNPL, Tap-To-Pay Service

Fintech unicorn CRED has started rolling out a buy-now-pay-later (BNPL) service, CRED Flash, and a tap-to-pay feature for its users. This service addition will broaden the fintech’s product offerings and boost monetisation.

CRED Flash will allow customers to make payments on the app and across more than 500 merchant partners. Users can then clear the bill at no extra charge in 30 days. CRED Flash also allows users to make bill payments and recharges. Parfait Finance, an RBI-registered non-banking financial company (NBFC), is backing CRED’s BNPL offering, the company was cited as saying by a TechCrunch report.

The tap-to-pay feature, called Tap & Pay, will allow users to make payments using credit cards on their phones with a tap on the terminal machine. The feature is currently rolling out on Android smartphones with NFC.

“Tap to Pay addresses CRED members’ need for a fast, simple, and safe offline payment experience. Tap to Pay uses secure card tokenization technology to store card tokens on the device,” the fintech unicorn was cited as saying.

This service addition is the latest in a series of new offerings from the fintech startup in recent years. Last year, CRED launched Scan and Pay, its UPI QR payments feature that allows users to scan UPI QR codes and make payments either at merchants or to other users.

CRED Flash is the second lending service available on the app, along with CRED Cash, a personal loan offering. It seems CRED is differentiating from its competitors by gatekeeping entry to its platform. The platform is an invite-only platform with an Experian HighMark credit score of 750 or above and claims to have 11.2 Mn active users.

While India’s BNPL segment is a highly competitive space, startups in the segment are struggling as they cater to a user base with shaky credit history.

CRED, which was last valued at $6.4 Bn during its $140 Mn funding round in June 2022, reported a loss of INR 1,279 Cr for FY22, up 2.4X from a loss of INR 524 Cr incurred in FY21, due to acquisitions and marketing expenses. At the same time, CRED’s revenue from operations grew 4.4X to INR 393.5 Cr from INR 88.6 Cr in FY21.

Backed by investors such as Sequoia Capital India, Tiger Global, DST Global, GIC Singapore and Alpha Wave Capital, CRED has raised more than $800 Mn to date.