Newtap Finance Private Limited to Raise Rs 550 Crore

Non-banking financial company Newtap Finance Private Limited is set to secure Rs 550 crore (approximately $64 million) from Newtap Technologies and CRED in the near to medium term.

Kunal Shah, the founder of CRED, has Newtap Technologies as the primary shareholder of Newtap Finance, which was formerly known as Parfait.

As stated in a press release by India Ratings and Research, between FY22 and FY24, the promoters have put in Rs 149 crore into Newtap Finance, with CRED contributing an initial infusion of Rs 35.7 crore thus far.

Services Offered by Newtap Finance

Newtap Finance (NFPL) provides personal loans to individuals, with CRED acting as the loan service provider. CRED boasts a monthly active user base of 12 million and offers various services, including credit card payments, UPI transactions, vehicle management, lending, insurance, and personal finance management through account aggregator systems, alongside rewards and deals.

While Newtap Finance’s loan book is yet to mature, CRED pre-approves loans for certain users based on their financial behaviour. All members of CRED possess high credit scores, which is a fundamental eligibility requirement for the application.

Ownership Structure

Kunal Shah owns 76% of Newtap Finance indirectly through his wholly-owned entity, Newtap Technologies, while CRED retains a 23.6% stake. Shah and CRED gained control of Newtap in 2022, although the RBI halted CRED’s attempt to increase its stake in 2023. Since then, Newtap has been focused on establishing itself as an independent NBFC.

Assets Under Management

As of December 2024, the total assets under management (AUM) outstanding on Newtap Finance’s platform stood at Rs 1,141.6 crore, with Rs 632 crore attributed to NFPL’s books. The company has also formed partnerships with two significant lenders—a bank and an NBFC—for co-lending, with plans to expand co-lending activities shortly.

By December 2024, CRED’s AUM reached Rs 19,000 crore, with a non-performing asset (NPA) ratio of 1.1%, as mentioned in the press release.

In the fiscal year concluding in March 2024, CRED achieved a remarkable 66% year-on-year growth in operating revenue, amounting to Rs 2,473 crore. Additionally, the operating losses for the Tiger Global-backed enterprise decreased by 41% during the same timeframe.