Fintech firm Cred's revenue rises 66%, losses decline to Rs 609 crore

Fintech firm Cred reported a decline in its operating losses to Rs 609 crore in financial year 2024 (FY24), a substantial decrease from Rs 1,024 crore in FY23.

The Bengaluru-based company reported a 66 per cent increase in revenue to Rs 2,473 crore in FY24 from Rs 1,484.6 crore in the previous year.

The steep decline in the company’s losses and the increase in revenue come as its marketing expenses declined by 36 per cent and its monthly transacting users (MTUs) expanded by 34 per cent on a year-on-year (Y-o-Y) basis.

“What happens is when revenues start picking up, you're not necessarily adding headcount or spending the same amount of marketing dollars to acquire customers. This is because you have built a brand, invested upfront in it, and now built a flywheel of being able to get a higher average revenue per user (ARPU),” said Kunal Shah, founder, Cred.

About 35 per cent of the company’s MTUs use three or more products on the platform. Close to 60 per cent of the platform’s customers use two or more products, compared to 40 per cent in the previous year.

It has a base of over 11 million customers.

Cred makes more than 90 per cent of its revenue from three verticals: lending, payments, and insurance.

Shah elucidated that after the Reserve Bank of India (RBI) hiked risk weights for unsecured credit last year, the company has seen increasing interest from banks and non-banking financial companies (NBFCs) to partner with Cred on account of its user base.

“We have not seen the impact that the industry saw because we were actually focused on longer tenure, higher-quality customers with low interest rates. We see every major bank and NBFC keen to partner with us because we have become the fintech of preference many times for sourcing the highest-quality customers,” he added.

Shah also noted that the company refrains from engaging in speculative products in the market.

“We’ll never do speculative products that make a lot of money but cause consumers to lose their money. This includes those likely to have extraordinarily high interest rates, and hence the focus is on making products that cause financial progress,” he added.