An eight-month-old startup in India that wants to improve the user experience of credit card holders in the nation has received the backing of at least two major investors.
Pune-based FPL Technologies said Thursday it has raised $4.5 million from Matrix Partners India, Sequoia Capital India and others in its maiden financing round.
In an interview with TechCrunch earlier this week, Anurag Sinha, co-founder and CEO of FPL Technologies, said the startup aims to build a full-stack solution to reimagine how people in India get their first credit card and engage with it.
Even as hundreds of millions of people in India today are securing loans from organized financial lenders, most of them are unable to get a credit card. Fewer than 25 million people in the country today have a credit card, according to industry estimates. And even those who have a credit card are not exactly pleased with the experience.
Much of the blame goes to banks and other credit card issuing firms that are largely relying on archaic technology to operate their plastic card business.
Sinha, an industry veteran, said through his startup he aims to address a wide range of pain points of credit card holders, such as in-person meeting or telephonic interaction with bank representatives for getting a credit card, having to talk to someone to get basic support and not being able to mask the card’s identity when shopping online.
The startup, which employs about 20 people, aims to build the mobile credit card service in the next couple of months, but in the meantime, it is offering an app called OneScore to help users check their credit score and learn how to improve it. Sinha said OneScore, unlike most of its rivals, doesn’t sell the data of customers to third-party agencies.
The app was launched two months ago and has already amassed more than 100,000 users, Sinha said. These users would get the first dibs on the startup’s mobile credit card, he said.
In a statement, Shailesh Lakhani, managing director of Sequoia Capital India, said, “When they presented a plan to modernize credit cards in India it immediately resonated with the Sequoia India team. It’s a delight to partner with them as they work on developing more flexible, affordable and easier to use financial products for Indian consumers.”
In recent months, a handful of startups in India have started to explore ways to expand the reach of credit cards in the nation and incentivize users to become more responsible with how they engage with it. Bangalore-based SlicePay offers a payment card with a pre-approved credit line for students, gig-workers, freelancers and startup employees. CRED, a startup by industry veteran Kunal Shah, recently raised $120 million to motivate users to improve their financial behavior.