Cred: Cred to acquire Kuvera for an undisclosed amount marks entry into wealth management

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Kunal Shah-led fintech platform Cred is set to acquire Kuvera, an online wealth management startup backed by American investment firm Fidelity for an undisclosed amount, the company said in a release today.

This development marks the entry of Cred into the mutual funds market, placing it in competition with industry leaders such as Zerodha, ETMoney and Groww.

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Following the acquisition, Kuvera’s 50 member team, the founders, will join the larger product team at Cred. The company will continue to operate independently while collaborating closely with Cred’s leadership to enhance the network, brand and distribution, according to the statement.

The deal is through a mix of both cash and stocks. Kuvera’s investors will receive shares in Cred in addition to a cash component as part of the deal, a person aware of the matter told ET.

Founded in 2016 by Gaurav Rastogi and Neelabh Sanyal, Kuvera allows users to invest in direct mutual funds, digital gold, fixed deposits, Indian and US stocks. It has around 3 lakh users with assets under management of around Rs 50,000 crore.

The average per month investment in a mutual fund SIP through Kuvera stands at Rs 5,000 which is higher than the industry average. Even for a Kuvera user the total investment into mutual funds in a year is around Rs 12lakh, higher than industry standards, the person quoted above added.

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For Cred, which caters to the needs of the premium segment of the Indian consumers, it fits well in terms of the user base.“Kuvera is extremely popular among financially savvy Indians; their products and vision are aligned with Cred’s principle of investing for long-term value creation,” Kunal Shah, founder, Cred, said.

To date, Kuvera has secured a total of $10 million in funding, with the last round of $5 million being led by Fidelity in 2021.

“Together with Cred we see an exciting opportunity to fast-track building new products and features for our community while also bringing a trusted wealth management solution to millions more,” Gaurav Rastogi, founder, Kuvera said.

In the fiscal year 2023, Cred’s total income rose 3.5 times to Rs 1,484 crore from Rs 422 crore the previous year. Its losses went up marginally to Rs 1,347 crore from Rs 1,279 crore in the year prior.

Over the past few years, Cred, which is valued at over $6 billion, has expanded its financial services offerings by entering into credit, vehicle management and insurance and now wealth management.

Cred has grown through strategic acquisitions over the last few years. It has acquired credit underwriting platform CreditVidya, prepaid payment company HipBar and expense management platform Happay till now.

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