CRED Stash Review: 1-click KYC to access credit in 90 seconds

At the time when coronavirus has impact across all industries, the need for liquidity is at an all time high. CRED, the credit card bill payments platform has rolled out access to a credit-line exclusively for its members named CRED Stash. It maybe categorised as a personal loan product, but there is more to it. Here is everything you need to know,

What is CRED?

CRED is a member only app reserved for the few having very good credit score (750 and above). The app allows you to pay all your credit card bills from a single place and you get rewarded for it as well.

I’ve personally got well over Rs.30,000 worth of benefits since its launch in late 2018. The detailed review of the app is here:  CRED Review just incase if you’re new to it.

What is CRED Stash?

CRED Stash is the personal creditline given for CRED members, available at attractive interest rates compared to a typical personal loan and is completely a digital lending service that utilizes CKYC service setup by government for easier KYC process across financial institutions. Hence no more verification calls, no site visits, delays, etc – Its instantly available.

Its as simple as few taps and your money is in your a/c in a matter of minute or two. Makes sense isn’t it? I mean we have proved our credit worthiness over years by keeping the credit score good and why should we need to wait for a week or so for approval and disbursal?!

I wish this instant eligibility/approval system becomes a standard for all Credit Card applications too in near future.

These perks seems to be possible on CRED because all of its members have a better credit score, thus making the entire community creditworthy and trustworthy.

Charges

• Processing Fee: 1% to 2% (dynamic)
• Interest Rates: 11% to 16% (dynamic)
• Foreclosure Charges: Nil
• Part Payment Charges: Nil

Processing fee appears to be dynamic and is upto 2% depending on various factors like loan amount, credit score etc.

Interest rates appears to be in the range of ~13% for most test amounts I did but it could vary anytime as there maybe different lending partners providing different rates based on various parameters. For now, they have partnered with IDFC First bank and plans to add more in coming months.

That aside, there are no other charges for foreclosure & part payments, which is usually in the range of 3% with existing personal loan products.

CRED Stash Vs Personal Loans

• Its INSTANT: CRED Stash is an INSTANT credit line in both senses: Approval and Disbursal. A typical personal loan is not instant unless you’re pre-approved based on your relationship with the bank, in which case the loan amount usually depends on your NRV with bank.
• Its FLEXIBLE: CRED Stash by industry standards is an extremely flexible creditline. For ex, if you’re approved for 5L credit line, You may withdraw 2L today, 1L next month & 1L more after a month etc and once you’ve funds, clear all loans at once, without any fees. Flexibility like this is hard to find when it comes to anything related to direct handling of money.
• Attractive Interest Rates: Personal loans generally comes with 16% or above interest rates unless you’ve a premium banking relationship with a bank. With CRED Stash though, getting 13% or even lower rate is possible just with your credit history.
• User Experience: An user friendly interface & a frictionless process is what we get with CRED compared to a typical personal loan product. Then there are some good animations throughout the process for some fun, before you have the real fun with the money.

How much can I save?

To figure out how much one could save via CRED stash over conventional personal loans, let’s assume you take 2L loan at 13% with CRED, compared to 2L loan at 16% elsewhere. Let’s assume 0.75% difference in processing fee as I see in most cases. And also, lets assume you close the loan in half way (at 1L). With above assumption here are the savings:

• Savings via interest: Rs.3000
• Savings via Processing Fee: Rs.1500
• Savings via Pre-closure: Rs.3000
• Total Savings: ~Rs.7500

I personally see a great value with nil foreclosure fee & pre-closure charges as it not only helps us save but also gives the flexibility with which comes peace of mind.

Application Process

It has a super user-friendly application flow, so easy that you don’t even need to know what to do prior, as the app guides you well on each page. You get to see everything (loan summary with all details) on the final page before you tap the last button to withdraw.

The money is then instantly transferred to your chosen bank account. The entire process is done digitally, including the auto-debit setup for EMI. Here’s a visual treat for your eyes about the entire flow:

Credit Line & Eligibility

• To be eligible for CRED Stash, you just need to be a CRED member
• Credit Line: Depends on your credit report, score & many other factors as usual.

Even-though CRED Stash is eligible for all CRED members, its currently in beta and went live only for select members, for now. Its expected to be rolled out for “all” in a phased manner, in coming “weeks”.

However, do note that you need their latest app (with a redesigned UI) for you to avail the service. If eligible, you should be able to see the same on your CRED app’s home screen.

So if you’re using the old version, go ahead and update