India's CRED valued at $6.4 billion in new funding

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CRED is raising $140 million in a new financing round, its fourth funding in the past year and a half, as the Indian fintech startup courts millions of high credit score customers and broadens its offerings.

GIC, Singapore's sovereign wealth fund, is leading the Bengaluru-headquartered startup's Series F financing round, which includes secondary transactions, the startup said Thursday evening. Existing backers Tiger Global, Sofina Ventures, Alpha Wave Ventures and Dragoneer also participated in the funding, which values CRED at $6.4 billion, up from $2.2 billion in April last year and $4 billion in October.

CRED began holding preliminary conversations with a group of investors for this round last year, TechCrunch reported earlier. (At the time, the proposed valuation was about $5.5 billion. CRED disputed that report.)

The investment comes at a time when CRED is finalizing the acquisition of Smallcase, an Amazon-backed startup. In the early days of the deliberation, CRED sought to make an investment in Smallcase instead of acquiring it, TechCrunch reported earlier this year.

A CRED spokesperson has declined to comment on a deal with Smallcase.

The acquisition of Smallcase, which operates a platform to help a new generation of investors participate in the Indian equity markets, should allow CRED to supercharge its offerings to customers.

The startup, founded by fintech veteran Kunal Shah, helps and incentivizes individuals (by offering rewards such as cash back) to improve their credit score by encouraging them to pay their credit card bills on time. In the past one and a half years, CRED has significantly expanded its offerings.

The startup today provides its customers with discounts to high-end hotels and gives them access to scores of premium direct-to-consumer brands. Last year, it also launched Mint, a peer-to-peer lending service that enables customers to lend to other individuals on the platform at an "inflation-beating" rate.

The funding comes at a time when the Indian startup ecosystem, like those elsewhere, navigates a sharp reversal in pricing and frequency of funding rounds. Venture capital firms have hit brakes on writing new checks as they grow cautious about the dwindling market conditions globally.

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