[Funding alert] CRED nears billion-dollar valuation after $80M fundraise
Credit card bill payment app CRED has raised $80 million in a Series C funding round from Ribbit Capital, Sequoia Capital, and Tiger Global, giving it a valuation of $800 million.
The post-fundraise valuation — which is $200 million short of the coveted billion-dollar unicorn valuation — is almost twice as much as the Kunal Shah-led startup had been valued at ($450 million) after its Series B fundraise last year.
The news was first reported by TechCrunch, which cited a source familiar with the matter. CRED did not immediately respond to YourStory's request for comment.
A number of fintech companies have hit billion-dollar valuations this year, including RazorPay and Zerodha, or are poised to as investor interest in the sector grows. Overall, fintech has outperformed most other sectors this year in terms of fundraise and customer traction, due to the coronavirus pandemic and the ensuing lockdowns that sped up the adoption of online payments.
Founded in 2018, CRED rewards users for paying their credit card bills on time in the form of CRED coins which can be redeemed for various products in its online store. The startup has partnered with brands such as BookMyShow, Urban Ladder, Airbnb, CureFit, FreshMenu, and Ixigo, among others, for rewards, experiences, and upgrades.
The platform also offers flexible, low-interest, instant loans via its CRED Stash product, as well as allows members to pay their monthly rents on credit as part of its CRED RentPay service.
The app, which only allows people with credit scores over 750 to join, counts over three million users, according to a Business Standard report.
CRED has enjoyed considerable traction over the pandemic-ridden months. Its RentPay service was well-received by people who were financially struggling during the lockdown months due to salary cuts and layoffs. Despite all that, Kunal has said the company did not witness any distress in repayments from its members.
CRED is Kunal's second venture after Freecharge — a coupon-powered mobile recharge app, which Snapdeal bought for $450 million in 2015.
Edited by Kanishk Singh