“More Money. More Problems. Not anymore.”
– Kunal Shah (Tweet on X)
This tweet made waves in the fintech market as it marked the launch of CRED money, a new product (payment solution) launched by CRED. What is CRED money? You ask.
Well, it is a new payment solution that allows you to manage your finances on a single platform. Isn’t it similar to CRED’s working strategy involving the management of multiple credit cards on the CRED app?
Yes, but it is way more advanced than that…
If you want to know more about this then stick to this article because we will discuss CRED’s latest product to manage finances!
(A) What is CRED Money?
CRED Money is a financial management platform launched by the reward-based payments platform CRED. This new feature aims to help users manage their finances more effectively by offering a comprehensive view of their financial activities across multiple accounts and platforms.
If you’ve ever found it challenging to keep track of various bank accounts, wallets, and UPI IDs, CRED Money could be the solution you’ve been looking for.
(B) Features of CRED Money
CRED Money is a financial management platform. As the name suggests, it offers multiple features like-
- Check balances and transactions from multiple sources such as Bank Accounts, Wallets, UPI IDs, etc.
- Make recurring payments
- Analyse spending
- Understand financial patterns without sharing your bank account
- Fetching details from participants of the account aggregator ecosystem (Banks, Mutual Funds, Insurance, etc.)
So, no more logging into different apps or websites to check your financial status. With CRED Money, everything is consolidated, making it easier to understand your overall financial health.
(C) How CRED Money Works?
CRED Money is built on the account aggregator (AA) framework. This framework enables secure and encrypted sharing of your bank account information between authorized organizations.
What does this mean for you?
It means that without sharing your bank account details directly, CRED Money can fetch information from banks, mutual funds, insurance providers, and other financial institutions. This helps you understand your financial patterns and manage your finances more effectively.
Let’s go through the details of the working strategy of CRED Money and how is it beneficial for you-
(C.1) Streamlined Payments
Managing recurring payments like SIPs, EMIs, and insurance premiums can be quite a hassle. CRED Money simplifies this by allowing you to make these payments through its UPI-based payment service. It sends you reminders and updates, ensuring that you never miss a payment. This not only helps in managing your cash flow but also in avoiding late fees and penalties.
(C.2) Spending Analysis
Have you ever wondered where all your money goes by the end of the month? With CRED Money, you can analyze your spending patterns. The platform categorizes your transactions by merchant or category, helping you understand your financial behavior.
This can be incredibly useful in making adjustments to your spending habits.
Maybe you’ll realize you’re spending too much on dining out and decide to cut back, or perhaps you’ll find room to increase your investments.
(C.3) Personal Finance Management
One of the standout features of CRED Money is its use of the account aggregator framework. This is part of India’s digital public infrastructure, which gives you control over your data. The platform presents your financial information in an organized format without requiring you to manually input data. This makes managing your personal finances less stressful and more efficient.
(C.4) Trace Forgotten Investments and Tax Refunds
Do you have investments or tax refunds that you’ve forgotten about? CRED Money can help you trace these. By linking your PAN or phone number, the platform can find long-lost investments. This feature is particularly beneficial for individuals who have multiple investments and accounts, as it helps in consolidating and keeping track of all your financial assets.
(C.5) Data-Driven Insights
CRED Money doesn’t just provide you with a static view of your finances; it offers data-driven insights. By analyzing your financial data, it can help you make better financial decisions.
For example, it can identify underperformers in your investment portfolio, allowing you to make adjustments to maximize returns.
(C.6) Security and Privacy
Security is a major concern when it comes to sharing financial information. CRED Money addresses this by ensuring that all data sharing is secure and encrypted. The account aggregator framework ensures that your data is only shared with authorized organizations, giving you peace of mind.
(D) How will CRED Money generate revenue?
The revenue generation strategies for CRED Money include several key components viz.-
(D.1) Transaction Fees
CRED Money facilitates various transactions, such as bill payments and rent payments through its “CRED RentPay” service. Users can pay their rent using credit cards, which earns them rewards points. CRED charges a transaction fee (usually between 1% to 1.5%) on these payments, sharing a portion of this fee with the financial institutions involved. This fee structure contributes significantly to CRED’s revenue.
(D.2) Affiliate and Listing Fees
CRED Money collaborates with various businesses and financial institutions to offer products and services to its users. Businesses pay CRED listing fees to feature their offers on the platform. Additionally, CRED earns commissions for each successful transaction or user acquisition it generates for these partners. This affiliate model not only enhances user engagement but also serves as a lucrative revenue source.
(D.3) Data Monetization
CRED collects extensive data on user spending habits and financial behavior. While it does not sell this data directly, it can monetize it by providing insights to financial institutions and banks. These entities pay for access to aggregated data that helps them tailor their offers and marketing strategies, thus generating additional revenue for CRED.
(D.4) CRED Store and Reward System
The CRED Store allows users to redeem CRED coins earned through timely payments for various products and services. CRED earns revenue from businesses when users redeem these coins, as businesses pay a fee for the traffic and sales generated through the platform. This rewards system encourages user engagement and loyalty while providing a financial incentive for CRED.
CRED has been expanding its offerings in the financial sector. In April 2023, it launched a UPI-based payment service, and in September, it introduced a vehicle management platform called Garage.
With the acquisition of Kuvera in February this year, CRED has strengthened its position in the wealth management space. We have explained it in detail here- CRED acquired Kuvera to tap into the mutual funds sector.
CRED Money is a natural extension of these efforts, providing users with a comprehensive financial management tool.
(E) The Road Ahead for CRED Money
From July 25th, CRED Money was already rolled out to its members in phases. This phased rollout allows for gradual adoption and feedback, ensuring that the platform can be fine-tuned to meet user needs more effectively. It’s part of CRED’s broader strategy to offer more daily or weekly use cases and to enhance its offerings in the wealth management space.
(F) CRED’s Market Position
In terms of UPI payments, CRED has emerged as a significant player. As of June, CRED UPI processed more transactions than Amazon Pay, WhatsApp, and BHIM. Although it is behind PhonePe, Google Pay, and Paytm, CRED has established itself as a formidable contender in the digital payments space.
Revenue & Growth
CRED’s financial performance has been impressive. In FY23, the company’s operating revenue grew 3.5 times to Rs.1,400.6 crore from Rs.393.5 crore in FY22. This growth was driven by its various revenue streams, including facilitating rental transactions, interest income on peer-to-peer loans, and processing fees on loans. Despite a modest increase in losses, CRED’s revenue growth highlights the effectiveness of its business model and the value it provides to its users.
(G) Wrap-Up
CRED Money is a powerful tool for anyone looking to manage their finances more effectively. By providing a unified view of your financial information, streamlining payments, and offering data-driven insights, it simplifies the complexities of personal finance management. With its secure and user-friendly platform, CRED Money is poised to become an essential part of the financial lives of India’s affluent population.
Whether you’re looking to trace forgotten investments, analyze your spending, or manage recurring payments, CRED Money has got you covered.
If you are using CRED Money then feel free to share your thoughts in the comments section!
Thanks for reading 🙂
