The world's leading social media company Meta is now going to take a big step in the Indian fintech market. This company led by Mark Zuckerberg is making a huge investment of ₹ 8,550 crore (about $ 900 million) in India's famous credit card payment platform Cred (CRED). Under this mega deal, Meta will get a major stake of 20 percent in Cred.
But, the most surprising thing about this deal is that despite spending billions of rupees like water, Meta will not get any personal data of Cred customers. Giving priority to the trust of its customers, CRED has completely put up a 'no entry' board on data access. Along with this, there is also going to be a big change at the leadership level in the company, where founder Kunal Shah is stepping away from the daily functioning of the company.
Cred currently has about 1.7 crore premium members. These are people who have excellent CIBIL scores and who share highly sensitive financial information related to their credit card bills, banking transactions and expenses on this platform. Meta is a company primarily dependent on advertisements, which always keeps an eye on user data. In such a situation, CRED has taken a very conscious step by keeping Meta away from this database. Its biggest advantage will be that the data of common man and premium customers will remain safe on the platform and their trust will remain intact. Additionally, the company will be completely protected within the ambit of India's Digital Personal Data Protection (DPDP) law and strict financial regulations.
With this investment a new era is beginning within CRED. Founder Kunal Shah, who took the company to new heights, is now stepping away from the day-to-day operations after holding the helm for nearly eight years. Now in his place Mitan Sampat has been given the responsibility of interim CEO of the company. Mitan Sampat is not a new face. He has been looking after the strategy and finance of CRED since the year 2020. Now he will have a huge responsibility on his shoulders to keep the company continuously profitable and take it to IPO in future.
Now the question arises that if Meta does not get the data, then what will Cred gain from this partnership. In fact, Cred will get the direct support of millions of WhatsApp users present with Meta. In the future, financial services like credit card payment reminders can be introduced within WhatsApp itself, completely protecting the privacy of customers.
This is a great time for Credit on the economic front as well. At present, the company's annual income has crossed ₹ 3,200 crore and recently it has also recorded its first profitable quarter. Cred will use the fresh funds of ₹ 8,550 crore from this deal to rapidly expand its loan business. The company is already managing assets worth ₹24,000 crore, and is now eyeing a bigger footprint in the insurance and wealth management sector.
