Fintech Startup CheQ Raises $10 Mn To Launch Credit Management Platform

Bengaluru-based fintech startup CheQ has raised $10 Mn in a seed round led by Venture Highway and 3one4 Capital. The seed round also saw participation from Multiply Ventures, Marshot Ventures and Veda VC.

CheQ also has the backing of angel investors such as Naveen Kukreja (CEO, Paisabazaar) and Shailaz Nag (founder and CEO, Dotpe).

The startup is targeting to launch its first product, a credit management platform and build a team with the incoming funds. It will also invest in technologies that will help it differentiate itself from other players present in this space. According to the startup, it will launch its platform within the next few months.

Founded in 2022 by Aditya Soni, CheQ claims to have a team of 30 people and aims to hire up to 70 more people by the end of the year.

CheQ aims to simplify discovering and managing credit products for customers, allowing them to make good decisions of the same.

According to Soni, India’s credit ecosystem is seeing growth and adoption, but customer awareness is still lacking. This often results in a range of bad experiences with different repayment cycles and different charges and penalties.

“We are developing a customer-first platform which focuses on improving the credit health of customers by making it easier for customers to track, manage & and pay all their credit payments in one platform,” Soni added.

He further said, “The fundraising is a massive vote of trust from the investors and further validates our hypothesis that we are behind a large problem statement which must be solved.”

Nitya Agarwal, vice president at 3one4 Capital said, “CheQ is reimagining financial discipline for the masses by solving for end-to-end credit management. With the rise of BNPL and credit penetration in India, the end-users have limited awareness of the various financial products that they are signing up for. We’re excited to work with CheQ as they build a robust unified repayment platform to empower users to manage their credit in a more rewarding and disciplined manner.”

CheQ’s fundraiser comes at a time when India’s fintechs, especially in the credit segment, are under pressure from the recent RBI mandates, that have limited fintechs from what they can do in terms of credit products.

On June 20, the RBI issued a notification on PPI-MD (Prepaid Payment Instruments-Master Directions), which denied the loading of non-bank PPIs from credit lines. Therefore, fintech startups, which are not banks, can’t issue a credit in partnership with banks. For example, wallet postpaid such as Paytm Postpaid and MobiKwik’s postpaid service can’t work anymore because of this notification.

Even though the notification is a bit ambiguous and clarification on the same is expected by the industry from the RBI, it is clear that RBI has raised questions on the business models of fintech startups.