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CRED Business Model – How Does CRED Make Money?

cred business model

Managing finances has become challenging for many individuals in today’s fast-paced world. With various credit cards, loans, and bills to keep track of, it’s easy to lose control of your financial health. And then someone came to the rescue. A few years ago, CRED burst onto the scene and became one of the most innovative platforms focused on helping people pay off their credit card debt. 

CRED has become one of India’s most innovative and fastest-growing financial technology companies. Founded in 2017 by entrepreneur Kunal Shah and investor Vijay Shekhar Sharma, CRED has quickly become a major player in fintech. Its unique business model has made credit management easier for users and allowed the company to earn revenue through its services.

With its ever-growing partnerships and strategic alliances, CRED is well-positioned to continue building on its success and driving value for its customers. Read on to learn more about CRED and its financial success.

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Everything About CRED Business Model 

In this blog, we will read the CRED revenue model. It explains how CRED earns revenue by offering value-added services to its users and generating commissions from credit card companies. Now, you may wonder how the CRED business model works and how the company makes money. Overall, CRED’s business model is based on providing its users with a convenient and secure platform to manage their finances while rewarding them for making responsible credit decisions. 

What is CRED?

Established in 2018 by Kunal Shah, the former CEO of FreeCharge, CRED has rapidly emerged as a leading fintech firm in India thanks to its innovative approach to credit management. Its mobile application is accessible on iOS and Android platforms, rewarding users for exhibiting positive credit practices. By allowing cardholders to access and handle their credit card accounts, CRED enables them to accrue reward points based on their credit utilization.

Membership entitles users to various value-added services, encompassing reminders for credit card bill payments, automated payment options, and attractive incentives for prompt payment of credit card bills. These benefits comprise cashback, discounts, and special offers from prominent brands across various categories, such as travel, dining, and entertainment.

CRED has quickly become one of India’s most innovative fintech startups, with over 5 million registered users as of 2021. The company has raised over $220 million in funding from top investors such as Sequoia Capital, Ribbit Capital, and DST Global and is valued at over $2 billion. Its success has been attributed to its unique business model, user-centric approach, and focus on simplifying user credit management.

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The Idea Behind CRED Business Model 

1. Manage Credit Payments

The company identified that managing credit card payments could be complicated and stressful for users. For this, they developed a user-friendly platform that simplifies the credit card management process, making it easier for users to pay bills on time and earn rewards.

2. Value-Added Services

The app offers bill payment reminders, automatic payment options, and exclusive rewards for timely credit card payments. These rewards include cashback, discounts, and exclusive offers from renowned travel, dining, and entertainment companies partnered with CRED.

3. Membership-Based Model

CRED requires users to meet specific credit score criteria to become members. Once users become members, they gain access to the previously mentioned value-added services.

4. Earns Commission From Credit Card Companies

CRED earns revenue by receiving commissions from credit card companies when its users make payments towards their credit card bills. 

5. User-Centric Approach

CRED strongly emphasizes providing value to its users by prioritizing their needs and requirements.

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Who are CRED’s Customers? 

1. High Credit Score Users

CRED focuses on serving customers with strong credit scores and has exhibited responsibility with credit card payments. Typically, these individuals possess multiple credit cards, which may make it difficult for them to monitor expenditures and payment deadlines.

2. Urban Residents

CRED’s customers are urban residents in India who use credit cards and rely on mobile apps for financial transactions. Their busy schedule necessitates a quick and convenient means of managing credit cards, hence their preference for mobile applications.

3. Tech-Savvy Users

CRED caters to tech-savvy users who easily use digital platforms to manage their finances. These customers are well-versed in technology, so they prefer digital solutions to conventional banking methods.

4. Reward-Oriented Users

CRED’s clientele comprises both reward-oriented and value-conscious users. The former are keen on cashback, discounts and other special offers, which can be earned by promptly settling their credit card bills. Such customers usually focus sharply on pricing and strive to minimize expenses. 

5. Value-Conscious Users

CRED is used by value-conscious users who want to avoid paying extra fees or expenses for payments and delays. Also, travel people use CRED to earn points, discounts, and other rewards. 

CRED’s Value Proposition

CRED is a technologically advanced platform that seeks to enhance and streamline the credit card management process for its users. CRED’s business model provides credit cardholders a seamless and convenient experience, coupled with many incentives and perks for its members. Let’s see what these incentives are. 

1. Simplified Credit Card Management

CRED provides an easy and streamlined platform for managing credit cards, enabling its users to conveniently connect all their credit cards to the application to view their account information in one place.

2. Payment Reminders

The application also promptly notifies users when payments are due, thus eliminating the risk of missing deadlines and incurring penalties.

3. One-Click Payments

CRED revenue streamlines the overall payment process as users can seamlessly make payments without navigating through multiple websites or applications.

4. Rewards And Benefits

CRED offers its members a range of rewards and benefits, including earning points for timely payment of credit card bills that can be utilized for price reductions, cashback, and exclusive opportunities. It also gives experiences of luxury hotel stays and VIP concert tickets to premium users.

5. CRED Protect

CRED Protect offers a feature that assists clients in preventing fraudulent transactions and unauthorized use of credit cards. If any suspicious activity is detected, the app sends an alert to the user and offers assistance in resolving the issue.

How Does CRED Operate?

CRED is an exclusive platform that provides a seamless and hassle-free experience to credit card users in India. Here is an in-depth overview of how CRED operates:

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1. Profile Creation

To use CRED, the initial step involves creating a personalized profile that requires providing personal details such as credit score, income, and location. This information is crucial in verifying your identity and determining your eligibility for credit or debit cards.

2. Card Application

Once your profile is created, you can submit a request for a credit or debit card via CRED. This procedure involves going through the bank’s standard verification process to establish creditworthiness. The bank will send a unique CRED card tied to your profile upon approval.

3. Card Usage

Once your CRED card is ready, you can use it to make transactions and access funds within the CRED account. Every transaction made generates an email or SMS confirmation detailing the purchase and providing a receipt for future reference.

4. Rewards Program

One of the key benefits of using CRED is its rewards program. By actively utilizing your CRED card, you increase the rewards you can receive. These rewards come in cashback, special discounts, and various other offers. Additionally, redeeming these rewards will give you access to various beneficial items, such as travel vouchers and gift cards.

5. Additional Services

CRED also offers additional services to help manage your finances. Your CRED account comes equipped with financial education, money management, and budgeting tips to assist you in making informed decisions. Call CRED’s customer care services to assist you with any inquiries or challenges you face.

CRED Market Valuation and Funding 

CRED, the Indian fintech startup, has seen remarkable growth since its inception in 2018. It has quickly become one of the most valuable startups in India, with a market valuation of over $6.4 billion as of June 2022. Here’s a closer look at CRED’s revenue and funding:

1. Funding Rounds

CRED has raised $801.5 million in funding across 9 rounds. Its latest funding round was on June 9, 2022, where it raised $6.2B in a Series F funding round led by a team of 5 investors.

2. Investors

CRED’s latest investors are Tiger Global Management and Sofina. Other prominent names include Sequoia Capital, Ribbit Capital, DST Global, Tencent, Hillhouse Capital, and General Catalyst.

3. Valuation

CRED’s valuation has been on an upward trajectory since its inception. In its latest funding round, CRED’s valuation reached over $6.3 to 6.5 billion, making it one of the most valuable startups in India.

4. Revenue Model

CRED’s revenue model is primarily based on commissions earned from banks and financial institutions to promote their credit and debit cards to users. CRED earns a percentage of the transaction value whenever a user makes a transaction using their CRED card.

5. Growth Potential

CRED has grown significantly since its launch, with over 11.2 million users as of the Financial Year 2022. The platform aims to expand its offerings beyond credit cards and into other financial products, such as personal loans and insurance.

CRED Revenue Model 

1. Affiliate Income

CRED generates revenue through multiple channels, including affiliate income, advertisements, and transaction fees. The company leverages its platform to promote credit and debit cards from various banks and financial institutions, earning a commission for every user-approved credit card application. Commission rates vary based on the transaction’s value and corresponding financial institution.

2. Aggregator Platform For Users And Investors

CRED is a convenient credit card aggregator platform that enables users to compare and select the most suitable options effortlessly. The company provides high-end credit cards endowed with elite rewards and advantageous privileges, attracting a wealthier clientele. As a result, CRED is an enticing collaboration opportunity for banks and financial institutions.

3. Revenue From Advertisements

CRED benefits from advertising on its platform due to its large user base. Financial institutions and banks are eager to target this demographic and pay a fee for featuring their product or service on CRED’s platform.

4. Transaction Fees

CRED also earns a percentage of the transaction value when a user conducts a transaction using their CRED card. This transaction fee is shared with the financial institution or bank that issued the card, with rates depending on the transaction’s type. CRED’s approach to revenue generation remains focused on monetizing its platform while providing value to users through its credit card management services.

5. Revenue From Loans

CRED has expanded its offerings to include personal loans, marking its foray into the lending space. The platform generates revenue through the interest levied on these loans, typically higher than the rates provided by conventional banking institutions.


In conclusion, CRED is a pioneering fintech platform that has revolutionized India’s traditional credit card sector. Its intuitive interface, rewards program, and supplementary features have made it immensely popular among its users. CRED primarily generates revenue by earning commissions from financial institutions and banks through its credit card aggregation service. 

However, to clearly understand the working and integration of the platform into your business, you need to evaluate different factors, and also need to remap the business strategies accordingly. If you’re planning to make the credit management easier for your firm, Rahul Malodia – the best business coach with 5+ years of experience will help you achieve the goals. 
With his extensive experience in the startup ecosystem, focus on developing a formidable team, and a culture of innovation, Rahul malodia’s “Vyapri to CEO” has played an instrumental role in several businesses’ success.

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