From the three-year IPL deal to the disrupted credit ecosystem, here's what CRED's founder and CEO has to say.
Recently, the Indian Premier League governing council announced CRED as an official partner of the upcoming IPL edition that starts in the UAE from September 19. It's a three-season deal that will run through the 2022 season.
Kunal Shah founded Bengaluru-based CRED in 2018, and its website describes it as "... a members-only app that offers you exclusive rewards for paying your credit card bill."
We (afaqs!) reached out to Shah over an email, and he told us that CRED is available for credit card users with "high credit scores". This audience comprises urban working professionals and first-generation wealthy, who have consistently demonstrated responsible behaviour, yet have not had the generational connections that enable access to a good life.
CRED members comprise the mass affluent- urban individuals, who typically drive the majority of consumption in the country. This consumer cohort is also one that was least affected by the (COVID) pandemic and lockdown.
As a central sponsor, CRED stands to gain a lot of mileage from the on-ground banners and billboards. But there are no crowds this time to view them, so we were curious to understand CRED's return on investment on it.
Says Shah, "The IPL is a celebration that isn’t limited to stadiums, but happens in everyone's homes." He said that people are passionate about the game, which makes it all the more important to create rewards and experiences that are intertwined, and are an integral part of the game.
Shah says CRED aims to offer reward experiences to its members that they can enjoy while watching the game. The unique experiences it (CRED) creates will help to generate awareness about the brand and spread its messages around incentivising good financial behaviour to the masses. He gave a few examples:
1. Members who pay their credit card bills on CRED during CRED Power Play - the Most Rewarding Overs will win assured cashback, with one person standing a chance of winning 100 per cent cashback on their credit card bill payment.
2. At the end of every game, CRED will reward the Payer of the Match where the 100th or the highest bill-payer during each match will win Rs 1 lakh in prize money, awarded in a special video conference ceremony and showcased on a ‘virtual fan box’ at the stadium.
3. CRED has also partnered with leading premium brands such as OnePlus, Myntra, Ajio, Puma, Lalit Hotels, CROSS, Tata Cliq, JioSaavn, Audible, CureFit, Dineout, Syska, Samsung, Motorola, RBL (Reliance Brands), Hugo Boss and WROGN to create and offer rewarding products, services and experiences to its members.
The Reserve Bank of India (RBI) had announced a moratorium on loan EMIs and credit card dues in March, and extended it to August. So, how is CRED dealing with the disruption in the credit ecosystem, and how it sees it play out.
Shah said, "CRED members comprise the mass affluent- urban individuals, who typically drive the majority of consumption in the country. This consumer cohort is also one that was least affected by the (COVID) pandemic and lockdown."
He then told us that even as "spending dropped to 70 per cent of March levels in April, May, and June," this group chose to pay their bills in full, despite the RBI moratorium. In fact, "we have seen that consumer confidence - measured through credit card spending volumes - has returned, at least among the mass affluent."
"The aggregate outstanding of CRED members - over three million of India’s most trustworthy card-holders - has returned in July and August to reach levels seen last in February and March," revealed Shah.
He said, "CRED members are at the vanguard of recovery, being the least affected by unforeseen circumstances and the first to start spending again." He added that brands that are on board with CRED have also seen the benefits of the community, increasing their product range and participation to co-create new forms of engagement with the members.
"Over time, we expect more people to hear about how we incentivise good financial behaviour, and opt to be part of our high trust community to take control of their financial well-being," Shah signed off.