New Delhi: Cred, the leading fintech firm, has achieved a significant milestone by securing in-principle approval from the Reserve Bank of India (RBI) to operate as a payment aggregator (PA). This development positions Cred to venture into the merchant payments business, where it will join the ranks of established players such as Razorpay and Cashfree.
Key Highlights:
- In-Principle Approval: Cred has received the green light from the RBI to function as a payment aggregator. While this is an initial approval, the final nod is expected to follow in the coming months.
- Merchant Payments Business: With the in-principle approval, Cred can now double down on its merchant payments business. As a PA, Cred will facilitate seamless transactions between customers and merchants, enhancing the overall payment ecosystem.
- Escrow Account Management: The RBI allows PAs to manage funds through an escrow account. Additionally, PAs can offer value-added services on top of payments, further enriching the user experience.
- QR Code-Based Solutions: Cred is actively developing an offline payments business, which includes deploying QR code-based ‘scan and pay’ solutions at retail outlets. This move aligns with the growing trend of digital payments and enhances convenience for both consumers and businesses.
- Industry Landscape: Cred’s entry into the payment aggregation space puts it in direct competition with other players in the fintech industry. Recently, CCAvenue, Innoviti Payments, and MSwipe also received their final PA licenses, signaling a dynamic and competitive landscape.
- Wealth Management: Beyond payments, Cred has diversified its portfolio by acquiring Kuvera, a wealth management platform. Kuvera serves around three lakh affluent customers with its wealth products, positioning Cred for growth in this segment.
- Financial Performance: In terms of financials, Cred reported ₹1,400 crore in revenue from operations in FY23, a substantial increase from ₹393 crore in FY22. Although losses grew marginally to ₹1,347 crore in FY23, the company remains focused on innovation and expansion.
Conclusion:
Cred’s in-principle approval from the RBI marks a pivotal step in its journey as a fintech disruptor. As it gears up to rival established players, the fintech landscape in India is set for exciting developments in the payment aggregation space. 🚀
Disclaimer: The information provided in this article is based on publicly available sources and should not be considered financial advice.
