Cred enters new business segment, launches vehicle management service
Cred, a well-established fintech unicorn renowned for its credit card management and bill payment services, has embarked on a new venture by entering the vehicle management domain through its innovative feature called ‘Cred Garage.’ This strategic expansion is seamlessly integrated within the Cred App, effectively broadening the array of services available to its discerning members.
Cred Garage is designed to provide a comprehensive suite of vehicle-related services, encompassing not only traditional financial transactions but also lifestyle enhancements. Among the services offered are concierge services, which can include a range of assistance such as booking appointments, making reservations, and arranging for various vehicle-related needs. Additionally, members can benefit from parking services, simplifying the often challenging task of finding convenient parking spaces in bustling urban areas.
By venturing into the vehicle management space, Cred aims to cater to the evolving needs and preferences of its user base. This expansion aligns with its overarching mission to offer members a more holistic and enriched experience beyond its core credit card and bill payment services. In essence, Cred Garage represents a strategic move to enhance the lives and lifestyles of its members by providing them with convenient and value-added solutions for their vehicle-related requirements.
Cred Garage is set to be made available to all Cred members starting from September 28, according to a statement by the company. It’s important to note that this foray into vehicle management is considered an extension of Cred’s existing bill payment services and not a fundamental change in the company’s core focus, as clarified by a company spokesperson to Moneycontrol. This expansion into vehicle management aligns with Cred’s goal of providing additional value and services to its members beyond its initial credit card and bill payment offerings.
The spokesperson for Cred highlighted the rationale behind the introduction of Cred Garage, emphasizing the significant overlap between unique credit card holders and car owners. Both groups typically belong to the top 10 percent of high-spending individuals with relatively higher disposable income. In this context, Cred Garage represents an extension of Cred’s broader mission, which aims to enhance the lives and lifestyles of its members by providing them with valuable services.
Cred Garage’s features were further explained by the company. Members can access a single dashboard where they receive priority 24/7 access to concierge services. Additionally, the platform offers timely reminders for bill payments, document management capabilities, and insights into spending patterns. This integrated approach seeks to simplify and enhance the overall experience for Cred’s members by offering a suite of services that cater to their financial and lifestyle needs.
Cred has further expanded its services by integrating DigiLocker into its app, allowing members to conveniently access essential documents such as driver’s licenses, vehicle registration certificates, and insurance papers whenever needed.
The app also features automated reminders for critical tasks like pollution checks, emission tests, and insurance renewals, ensuring that members’ vehicles remain in excellent condition. Members can even renew their motor insurance through the app and enjoy exclusive perks available to them, according to the company’s statement.
These additions to Cred’s services come at a time when the average value of Unified Payment Interface (UPI) transactions on the platform has declined significantly, and its share of the credit card bill payment market has also reduced. The integration of DigiLocker and the expansion into vehicle management demonstrate Cred’s strategy to diversify its offerings and provide added value to its members beyond its original core services.
The report from Moneycontrol on May 31 provided insights into Cred’s financial performance and transaction data. According to data available on the website of the National Payments Corporation of India (NPCI), which owns the platform, the average value of a transaction on Cred through UPI experienced a significant decline. In April, the average transaction value was Rs 4,529, marking a notable drop from Rs 13,300 in January 2022.
Despite a substantial increase in revenue, Cred recorded a net loss of Rs 1,279 crore in FY22. The company’s revenue surged by nearly 340 percent, rising from Rs 95 crore in FY21 to Rs 422 crore in FY22. However, it’s worth noting that the company’s losses more than doubled compared to FY21, increasing to Rs 524 crore. These financial figures indicate the challenges and shifts in Cred’s financial performance during this period, including a significant increase in revenue alongside mounting losses.
