This Motilal Oswal-backed startup is planning to issue a million credit-based cards in the next 150 days relying on the $2 billion worth loans it disbursed

• It only took 60 days for the digital lending startup KreditBee to issue 100,000 credit-based payments cards.
• The company claims that its $2 billion loan book of 5.5 million users has set the pace of this growth.
• KreditBee claims that the trigger for this card has been the consumption habits of its users.

Credit-based payment cards are getting quite an uptick as people’s consumption habits have taken a turn towards all things digital. As more and more users are getting comfortable spending online, the lack of payment solutions is not helping in any way.

This has pushed many Indian brands to roll out credit-based digital payment offering for customers to directly transact with the merchants. Over the last three months, PayU co-founder Nitin Gupta's Uni startup and Motilal Oswal-backed digital lending platform KreditBee have been trying to do just that.

It only took 60 days for the digital lending startup KreditBee to issue 100,000 credit-based payments cards. Impressed by the short timeline of this milestone, the fintech startup is now aiming to issue a million such cards by the end of March 2022. It claims to be well within the pace to achieve this target.

The company claims that they are adding about 5,000 users on a daily basis at the moment and that is the basis of the latest target.

Madhusudan Ekambaram, co-founder and chief executive of KreditBee, told Business Insider that the company will issue another 120,000 such credit-based payment cards in the month of October.

This will take the total tally to 220,000 since the launch of the card in August 2021.

The card offers a limit of ₹10,000 and increases up to ₹1,00,000 based on know-your-customer (KYC). The customer has to repay the amount in 45 days.

KreditBee — founded by Ekambaram and Karthikeyan K in May 2018 — is an instant personal loan platform for self-employed and salaried professionals. The company is backed by Mirae Asset-Naver Asia Growth Fund, PremjiInvest and others.

Target audience for KreditBee

Criteria	What do they do?
Set 1	Self-employed and salaried individuals from Tier II and III cities. Employees of micro, small and medium enterprises (MSMEs).
Set 2	People from metro cities who don’t have a banking history and are looking for convenience.
Set 3	New age gig workers — delivery persons of ecommerce companies or food aggregatory businesses whose salary majorly consists of incentives.
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The company offers flexi-loans as well as personal loans starting from ₹1,000 to ₹2,00,000 to individuals and hosts several licensed non-banking financial companies (NBFC) to facilitate these.

Ekambaram claims that KreditBee has given out loans ₹15,000 crore ($2 billion) in the short span of three years and has over 5.5 million credit users on their platform. The launch of these credit-based payment cards has been on the basis of consumption habits of these individuals.

Therefore, the target audience for its lending business will be a target audience for these cards as well.

KreditBee had found that most of its users were getting loans in order to buy consumer durables like a mobile phone, laptop, earphone and more. This pushed the fintech startup to test out a digital card that will allow its customers to directly buy products online.

In addition, the card also allows KreditBee to interact with merchants directly and expand its data bank further.

The company’s profitability took a hit in the financial year 2021 due to COVID-19 pandemic, but it is back on track to report another profitable year, Ekambaram said.

Who else does KreditBee need to watch out for?

Uni, which too offers digital credit-based payments cards, has issued over 50,000 customers to date and is adding over 1,000 new additions on a daily basis. The company — launched last year and started operations in June 2021 — issues a special Visa 1/3 card, in partnership with RBL Bank and Mauritius-based SBM Bank, to its customers.

This offering works pretty much like a credit card, but divides all of the customers transactions into three installments that have to be repaid over a period of three months without any interest. The recently launched company aims to issue a million cards by the end of March 2022. It will be looking to launch physcial credit card by November 2021.

Fintech startup One Card has also recently partnered with Federal Bank to launch its mobile phone-based credit card. Meanwhile, Mastercard is experimenting with the buy now, pay later option to allow shoppers to style their payments in four installments.

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