Cred’s first profitable quarter comes with a trade-off. No, not Kunal Shah

**Rachel Varghese** (0:01)
If you have a credit card, chances are Cred has tried to win you over at some point. Maybe it paid your bill and gave you a cash back. Maybe it just impressed you with how good the app looked. And if you're like most people, you've probably also wondered how do they even make money?
Kunal Shah had been battling that question for most of Cred's lifetime.
What exactly was the business model? What was Cred all about?
And to be fair, these doubts did make sense. So the man spent eight years tackling them. Here was an app built for a small slice of credit-worthy Indians. But at the same time, it felt more like a lifestyle product than a fintech tool.
Then came the morning of June 22nd. Shah announced that Meta, the owner of Facebook, Instagram and WhatsApp, would invest roughly 8,500 crore rupees in Cred. Around the same time, Cred reported its first ever profitable quarter.
And that's exactly when Shah decided to leave. The founder of India's most argued about fintech, stepped away from daily operations and went to WhatsApp, the world's largest messaging app. He keeps a stake of less than 10% in the company he built. Behind him, Cred finally has money in the bank and a working business. But the new boss' job has very little to do with the ideas Cred was first founded on. So first, what does Cred look like without its founder? And second, why did a giant like Meta need a fintech founder from Bangalore this badly?
Welcome to Daybreak, a business podcast from The Ken. I'm your host Rachel Varghese and every day of the week, my co-host Snigdha Sharma and I will bring you one new story that is worth understanding and worth your time. Today is Thursday, the 16th of July.
Let's start with the deal itself. Of the 8,500 crore rupees Meta put in, about 5,100 crore went into the company. The rest went to existing investors through a secondary sale. Cred's cash reserves jumped from around 1,400 crore rupees to 6,500 crore. Meta walks away with a 20% stake, making it Cred's largest minority investor ahead of QED and Peak 15
Shah stays on as a shareholder with less than 10% equity. But operationally, he's out. Mitein Sampat, who has run strategy and finance at Cred since 2020, takes over as interim CEO. And he's expected to keep the job.
The timing does look deliberate. Cred just reported its first profitable quarter. In FY25, it earned over 2,700 crore rupees in operating revenue, up by 16% from the year before. Operating losses, half to around 300 crore. And in FY26, revenue grew to nearly 3,200 crore rupees. Monthly transatlantic users went from about 13 million to 17 million. And through all of that growth, marketing spend stayed flat at around 450 crore rupees a year. The company has been debt free for almost its entire life. So Cred is finally a business. But look closer at what kind of business it has become.
When Shah started Cred, the idea was simple and a little audacious. Reward the credit worthy. The app was built for people who paid their credit card bills on time. It felt like a lifestyle product. One investor told The Ken that it was a design that first made them believe in the product's seriousness. Shah leaned into that exclusivity. At a press conference in September 2025, he said that candidates' resumes wouldn't even be considered at Cred if their Sibyl score was below 750 The company launched Cred Sovereign, an invite only credit card made from 18 carat gold. But design does not pay the bills. Lending does. Today, roughly half of Cred's revenue comes from lending-related fees and interest. Over 30 percent comes from payments and bill processing. The rest is insurance and other commissions. In other words, Cred makes money the way every other UPI app makes money.
People in the fintech world have noticed. Rajendra Rehle, co-founder of the inshore tech firm Autolux, told The Ken that Cred's real USB was a design experience, and that the company has failed to maintain that distinction. His verdict on the app today cluttered.
The lifestyle experiments do back him up. Cred Escape, the curated premium travel feature, was shut down in January. Happy, the corporate travel startup Cred acquired for $180 million was sold to Make My Trip for less than $12 million. That sale triggered a large goodwill write down from around 1200 crore rupees to almost 500 crore in FY25. Cred chose profitability over distinctiveness. It worked, and its founder left the moment it did. So what does Cred look like without Kunal Shah? Stay tuned.
One investor put it straight. Think of Sampat as the Tim Cook to Shah's Steve Jobs. Less innovation, more operations. His mandate is to make Cred IPO ready. The board is already working on the leadership structure for that. And the raw material is there. Cred's lending book has crossed 24,000 crore rupees in assets under management. It's acquisitions of Spenny in 2023 and Kuvera in 2024 brought stock broking and investment advisor licenses. Kuvera alone manages nearly 33,000 crore rupees for about 300,000 investors. Through Cred Money, the company wants to pull a customer's entire financial life into one place. Provident Fund, pension, neutral funds, gold, silver, fixed deposits. Sovereign gold bonds are also coming next.