BENGALURU : Fintech startup focused on millennials, slice has raised $20 million as a part of its fresh funding round led by existing investors Blume Ventures, and Gunosy Capital, as it looks to double down on its growth in the coming months.
slice allows users to pay bills, manage expenses and unlock rewards. It is focussed on the new age millennial and Gen Z segment, with an average age of 23, that have largely been rejected credit cards by large banks, due to inadequate credit scoring around this demographic.
slice issues credit and payment cards to this segment in partnership with Visa and SBM Bank India Ltd., allowing them to build their credit scores and gain through rewards and discounts from payments.
It provides millennials a credit line starting from ₹10,000 up till ₹10 lakh.
“Banks shy away from issuing millennials a credit card, since they lack a credit score and customer acquisition cost for this segment can be high, owing to the credit underwriting needed. slice wants to change this paradigm for millennials. Currently, slice is the primary card for payments for 55% of its users, and 45% of our customers haven’t used a credit card before," said Rajan Bajaj, founder and chief executive officer (CEO) of slice in an interaction with Mint.
Bajaj adds that the company has been largely cash positive and profitable on earnings before interest, taxes, depreciation, and amortization (EBIDTA) basis in fiscal year 2019-2020.
Along with the fundraise, the company has also announced the launch of new features on the platform including ‘slice rewards’ and ‘slice in 3’. Through ‘slice rewards’ members can get upto 2% rewards on every card transaction, which are instantly redeemable in cash. ‘slice in 3’ allows users to split their card bills into instant equated monthly installments (EMIs) payable across three months.
The slice card is also accepted at offline payment points, through its partnership with Visa. At present, slice has a payment acceptance network of 5.5 million merchants, with 95% of its merchant partners based offline. It also offers users no-cost EMI products for online merchants including Flipkart.
The company now plans to roll out rewards for unified payments interface (UPI)-related transactions for its customers, in the coming months.
slice continues to be raking in debt to fuel its credit operations. Its non-banking financial company (NBFC) arm raised ₹165 crore in debt capital during fiscal year 2020-21 from 18 financial institutions including Northern Arc Capital, Vivriti Capital, AU Small Finance Bank, InCred Financial Services among others.
“slice’s biggest advantage is how well they understand millennials and Gen Z. Their approach to solving their issues has been truly refreshing and building something simple and hassle-free has been a part of their DNA since inception. The slice super card has the potential to fundamentally change the way the next generation thinks about the concept of credit cards altogether and we, at Gunosy, are glad to be a part of their growth story," said Shinji Kimura, chairman and CEO, Gunosy Inc.
At present, slice claims to have close to 4 million registered users and plans to touch 1 million card issuances by the end of FY’22. It has issued cards to 20,000 users this month and is on track to ramp up its monthly issuance to 50,000 users by September this year.
Founded in 2016, slice has also been backed by Das Capital, Finup, Simile Venture Partner, EMVC, Tracxn Labs, Better Capital, Sachin Bansal's Navi and angel investors such as Kunal Shah.
The company is also planning to power $1 billion in total annualised transaction payment value on its network by FY’22 end.
