Kunal Shah-led credit card payments app CRED is going to roll out two new lending products including a flexible credit line and paying rent via credit cards by next week.
Both services would be fee-based. While the rent payment service may be chargeable up to 1.75% of the amount, a credit line would be offered at around one-third of interest on credit card charges.
This development comes at a time when the whole economy is badly hit given the massive disruption caused by the Covid-19 pandemic and a demand for liquidity is high. As one of the major expenses incurred by any individual is paying rent, these credit cards will provide them liquidity and ease to carry out the transactions.
The new lending products were earlier planned to be launched at the end of this year. But with an unprecedented demand for liquidity due to an unexpected situation, the products will be launched to tens of thousands of CRED members first by next week and gradually to the rest of its users, stated the company in an TOI report.
CRED has partnered with one bank for now with ongoing conversations with a few others. The members just need to add bank account details or the UPI handle of their landlords to pay the rent, added the report.
CRED is a credit card payment platform that lets cardholders pay bills through the app, and get a bouquet of benefits via CRED coins. The virtual coins can be redeemed across coffee shops, movie theatres, e-commerce shopping, and other curated experiences and workshops, among others.
In August, the company had raised a $120 million worth Series B round led by Ribbit Capital and Gemini Investments. Before this, it had also secured a $30 million Series A round led by Sequoia Capital.
