What is CRED Mint? How will it give 9% returns to investors for lending money? Read

CRED has launched a peer-to-peer lending product which is called CRED Mint. It is the Bengaluru-based startups' first peer-driven product that will allow eligible CRED members to lend money from other users. The members who will lend money will be able to earn interest as well. The fintech company says that members will be able to earn interest on an inflation-beating rate, which is higher than conventional investment methods. Keep reading to know more about what is CRED mint investment, how CRED Mint works and other details. 

What is CRED Mint?

CRED Mint is a community-driven investment product, which has been launched in partnership with Liquiloans, an RBI registered peer-to-peer non-banking financial company. In a nutshell, CRED Mind will enable members to earn interest on idle money by lending it to other members on the platform. Additionally, any investment made through CRED Mint will be given through CRED Cash, which is a product designed for the platform's highly trusted members. 

"At CRED, we realised that some of our members have, on average, INR 2 lakh sitting in their savings account.  So, we wanted to create a product for our members where they can invest this money for inflation-beating interest, managed in a transparent and trustworthy manner, and withdrawable as easily as they invested it." as mentioned by CRED in an official blog post. 

How Cred Mint works?

CRED has been very particular in selecting members which are eligible to use the fintech's services. When a member will invest money into CRED Mint, it will be lent to other high-trust members like the investor. CRED also mentions that the money will be lent out to India's most creditworthy individuals. To reduce the default rate and investor's risk, the money that a member will invest will be routed directly to an escrow account held by Liquiloans. Additionally, the amount will then be lent to over 200 borrowers on the platform.

CRED says that investors can earn interest at inflation-beating rates at up to 9% per annum. Members will be able to invest between Rs. 1 lakh and 10 lakh within minutes, without any commission. They can also request withdrawal in one tap, both partially or fully at any point in time without penalties, earning interest on the amount of money and time for which it was invested. CRED also says that the money will be returned within one day to the member within one working day. 

What is peer to peer lending?

Peer to peer lending is a financial system where individuals can take loans from other individuals, without the intervention of a financial body like a bank. Peer to peer lending is also called crowdlending or social lending. For readers who are wondering about which are the top players in the P2P lending industry in India, startups like Lendbox, i2iFunding, Monexo and RupeeCircle are among the few firms.