CRED Rolls Out 4th Accelerated Wealth Programme, Hits Milestone with INR 250 Cr ESOP Repurchase


Three points you will get to know in this article:

  • CRED launched Accelerated Wealth Programme (AWP) for employees.
  • AWP allows faster stock options vesting, fostering wealth creation.
  • Despite revenue surge, net loss increased to INR 1,347.4 Cr.

Introduction to CRED

CRED, an innovative fintech venture hailing from India and headquartered in the vibrant city of Bangalore, was established in 2018 under the visionary leadership of Kunal Shah. At its core, CRED offers a distinctive credit card payments app that rewards users for their transactions. Beyond this, CRED extends its services to facilitate house rent payments and furnish short-term credit lines, catering to diverse financial needs. However, despite its notable achievements, CRED has not been immune to critique. Some voices in the industry have raised concerns about its valuation and the absence of a robust monetization strategy.

Since its inception, CRED has experienced significant growth. By the dawn of 2021, the company boasted an impressive user base exceeding 5.9 million, contributing to approximately 20% of all credit card bill payments in India. As of April 2021, CRED proudly presented a portfolio of six distinct products, including Cred RentPay, CRED Cash, Cred Pay, Cred Store, and Cred Travel Store, among others.

CRED's Accelerated Wealth Programme (AWP) and Focus on Employee Wealth

CRED, the fintech unicorn, recently kicked off its latest Accelerated Wealth Programme (AWP) for its team members just earlier this week. This program presents employees with an exciting chance to buy extra stock options that come with a faster vesting period.

This initiative stands as another way for CRED employees to build wealth, complementing the traditional ESOPs. The AWP is open for participation until March 31, 2024, allowing employees to seize this opportunity.

Additionally, sources mentioned that CRED has provided its employees with four opportunities for liquidation since its establishment in 2018. These opportunities have collectively generated wealth amounting to INR 250 Cr (approximately $30 Mn), illustrating the company’s commitment to fostering wealth creation among its workforce. In a regular ESOP plan, chances to cash out are usually limited to specific events like fundraising rounds, buyouts, or going public.

AWP Participation and Employee Involvement

According to reports, about a third of CRED staff have taken part in what’s known as the AWP. CRED introduced the AWP back in 2021, making it open to all full-time employees. Here’s the deal: employees can choose to receive a bigger chunk of their pay (up to half) in special grant ESOPs. These ESOPs come with a fast-track vesting period of just one year and give employees priority when it comes to cashing out during major financial events.

An inquiry email was sent to CRED but unfortunately, no response was received until the time this story was published.

Established back in 2018 by Kunal Shah, CRED stands as a platform specializing in payments and lending, offering a variety of tailored products designed for those with strong credit histories.

CRED's Expansion and New Offerings

From the start of 2023 onwards, CRED has been busy introducing new offerings. They’ve rolled out the CRED garage, a platform for managing vehicles, and have given a makeover to their travel platform, now known as CRED escapes. Additionally, they’ve made strides into the realm of ‘buy now pay later’ with their product, Flash, while also expanding their presence in the retail sector for both UPI and non-UPI merchants.

CRED's Strategic Acquisition and Financial Performance

Of utmost significance, the company’s UPI offering has garnered significant attention. Just last month (February), its UPI transaction volume hit 11.87 Cr, marking a remarkable 230% surge compared to February of the previous year, which stood at 3.6 Cr. CRED’s UPI payments amounted to INR 40,525.5 Cr in February 2024, witnessing a substantial 126% rise from INR 17,902 Cr in the same month last year.

In addition to this, CRED made a strategic move by acquiring the investech platform Kuvera, venturing into the rapidly expanding wealth management domain, challenging established players such as Zerodha, Groww, and PhonePe.

The startup, valued at a staggering $6 Bn plus, witnessed a remarkable surge in operational revenue, soaring by 250% to INR 1,400.6 Cr in FY23 from INR 393.5 Cr in FY22. However, there was a 5% year-on-year increase in net loss, reaching INR 1,347.4 Cr.

CRED recently launched the Accelerated Wealth Programme, offering employees the opportunity to purchase extra stock options with a faster vesting period until March 31, 2024. About a third of CRED staff has participated in this initiative, aimed at fostering wealth creation among its workforce. The company has also expanded its offerings, introducing the CRED garage, CRED escapes, and ‘buy now, pay later’ product Flash, as well as making significant strides in the UPI sector. Additionally, CRED strategically acquired Kuvera, entering the wealth management domain. Despite a notable surge in operational revenue, CRED saw a 5% increase in net loss, reaching INR1,347.4 Cr.

SA Team

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