shah, through Newtap Technologies Pvt Ltd, has acquired Parfait Finance & Investment, looking at a wider fintech game for Cred Borrow,
reserve Bank of India (reserve Bank of India) has approved takeoverPeople informed about the matter.
Shah had earlier co-founded mobile recharge firm FreeCharge and in 2015 sold it to Snapdeal for $400 million.
Credit, which is worth about $4 billion, has also applied to the banking regulator for an account aggregator license, people familiar with the development said.
People said the RBI approval for NBFC acquisitions came in October.
Although not a direct acquisition, buying a finance company indicates that the fintech startup is eager to increase its footprint in the financial services space.
Applying for an account aggregator license is also aligned with its strategy of giving credit to customers, said one of the people.
Credit’s current loan product had a loan book of Rs 2,000 crore with non-performing assets less than 1% in August.
It provides loans to already approved users but this is through partnership with IDFC First Bank.
Fintech firms in India are increasingly looking for NBFCs of their own to lend themselves as it helps them to design better products and achieve wider margins.
In August, it launched Credit Mint to enable users to lend to other credit customers – a tie-up with Liquidones – an RBI registered P2P non-bank.
Since its launch in 2018 as a credit card repayment player, Credit has forayed into the e-commerce, lending, payments and now investment segments within its platform.
In August, Shah told ET that around 25-30% of all
Credit card bill payments in India were being done through credit And that it now has more than 2,000 brands in its commerce business.
“Credit (Dreamplug Technologies Pvt Ltd) has not applied for acquisition of NBFC. Nutap Technologies Pvt Ltd, in which Kunal Shah Has invested in individual capacity, has applied to RBI for approval to acquire stake in Parfait Finance & Investments Private Limited,” the company told ET in an email.
Credit did not comment on a query regarding the demand for an account aggregator license.
An account aggregator license will enable customers to have consent-based access to account history which will enable various lenders who connect to the aggregator platform to automate their lending.
Walmart and Flipkart-backed PhonePe recently got in-principle approval for this.
An industry expert said that at a time when credit card issuers are charging exorbitantly high rates for roll-over and EMI facilities, there is an opportunity to provide cheaper, seamless credit to the premium segment.
In October, Cred closed a $251 million funding round in its third fundraising round of the year, raising its valuation to $4 billion.
Existing investors Tiger Global and Falcon Edge co-led the Series E financing round, which also saw participation from Marshall Weiss and Steadfast Venture Capital, DST Global, Insight Partners and others.