Most of the Indians have bank accounts but only 30 million of them have credit cards. This figure has remained pretty static for the past few years. As per the numbers, it only caters to a small population of India. Banks are not taking any active effort or risk elements to increase these numbers.
Slice, a startup is now taking up this responsibility. They believe that they can increase the number of credit card users in India. The startup has prior experience in providing its cards to young people who have no traditional jobs. Slice announced on Wednesday that it will launch a card with a limit of Rs. 2,000 to reach out to the potential Indian market in which it aims to gather almost 200 million individuals.
Slice’s new credit limit card, which is far lower than the industry’s lowest of roughly $270, is intended for folks who don’t have a fantastic credit score — or any score at all — and will gradually help them build it, according to Rajan Bajaj, the company’s founder, and CEO.
The business, which has recently been dispensing as many as 100,000 new super cards — its flagship offering — to customers each month, is not charging a joining charge or an annual cost for its new card, which comes with the same features as its super card.
According to Bajaj, the firm is able to provide this card to customers because it has spent years developing its own credit underwriting system. They had spent time and money in developing a strong infrastructure by using data science. He added that $27 was set as the limit because the amount is enough to make small meaningful transactions. If the users utilize this limit properly then they will be offered higher limits. Bajaj is confident that users will trust the platform and provide more information so that their credit limits can be increased.
Slice was able to raise $20 million in a financing round recently. It hopes to provide around 1 million new credit cards to users by March, next year. It is also expected to raise more funds soon. But Rajan did not provide any information on this. Talks are that investors are ready to back the startup in a new round of around $100 million with a higher valuation.