Cred-owned Spenny eyes stock broking licence to rival Zerodha, Groww

With 13 million users, Kunal Shah's Cred looks to diversify revenues, complementing payments, lending, and wealth management services

Kunal Shah-backed Cred is set to expand its financial services ecosystem by venturing into the competitive stock broking space. According to a report by Moneycontrol, Cred recently applied for a stock broking licence through its subsidiary, Spenny, almost a year after acquiring the Y Combinator-backed micro-savings and investment platform.

 

Cred’s primary revenue driver remains its lending services. The addition of stock broking could unlock new income streams, including transaction fees, account management charges, and advisory services. The platform has a user base of 13 million, including 11 million monthly transacting users.

 

Cred expands into financial services

Cred accelerated its wealth management expansion in early 2024 with the acquisition of Kuvera, a platform that offers direct mutual funds, fixed deposits, systematic investment plans, and digital gold. Although Kuvera had previously withdrawn a stock broking application, Cred’s latest attempt through Spenny signals a renewed push into this market, aligning with the platform’s plans to build a comprehensive financial services platform. This would also complement its existing offerings in payments, lending, insurance, and wealth management.

 

Stock market broking industry in India

On entering this segment, Cred will compete with Zerodha’s eight million users and Groww’s 12.3 million. Additionally, Cred’s expansion comes at a time when the Securities and Exchange Board of India (Sebi) is tightening rules around speculative retail trading, particularly in futures and options (F&O), which could impact brokerage revenues in the short term.

 

The Indian stock market broking industry has become increasingly popular in India, with the number of demat accounts surpassing 175 million as of September 2024. At the end of 2023, the number of demat accounts stood at 139 million.

 

At the end of FY24, Cred reported a threefold revenue increase over three years to Rs 2,500 crore. The platform also reduced its operating losses by 41 per cent to Rs 609 crore.