Rising debt, especially in the post-COVID era, has become more of a household problem. While it is traditionally known that the Indian middle class avoids taking on debt, newer forms of lucrative loans such as BNPL (Buy Now, Pay Later), Free EMI and more. just as easy to take advantage of debt. FREED, an online platform that helps consumers eliminate such and other debts, relies on this opportunity and has already received a $ 2.8 million preliminary round of Serie A.
Led by Inflection Point ventures, the circle included Multiply Ventures, Chandigarh Angels Network, Lead Angels, Hyderabad Angels, The Chennai Angels and HNI. The funds raised will be used to strengthen the team in the verticals, build a technology package for the introduction of new and differentiated debt relief products / services, to expand initiatives to acquire customers and promote the brand.
Founded in 2020 by Ritesh Srivastava, FREED is an online debt relief platform with a vision to help consumers achieve their financial freedom by helping them eliminate their debts. The platform now also builds its own credit scoring algorithm for near-first / Alt A borrowers by using data on borrower behavior during the DSP program. FREED disrupts and organizes the current retail debt settlement market by creating a comprehensive borrower-oriented platform that solves end-to-end pain points.
Speaking about the need for such a platform, Srivastava said: “FREED was founded with a vision to help debt-ridden consumers resolve their debts and regain their financial freedom. The problem requires immediate action and FREED will take the place of Friend and Financial Resurrector, helping consumers regain normalcy and a sense of balance in their lives.
Srivastava is a serial entrepreneur after founding a similar company in the United States. The venture helped settle nearly $ 2 billion in debt.
FREED currently claims to have registered more than 6,500 customers with more than Rs 350 million in retail debt (~ USD 45 million) and settled more than a thousand creditors’ accounts, offering to reduce consumer debt and resolve bad debts for creditors.
His hot offer was a debt settlement program. Targeted specifically at people with high levels of unsecured debt, it offers personalized budgeting, cost analysis, AI / ML repayment simulations, debt repayment strategies and credit education to help people avoid the debt trap.
With the growth of retail loans, rising NPAs and low late recovery rates, FREED is trying to solve the $ 15 billion NPA problem. The current book of unsecured retail loans has exceeded $ 160 billion and is growing by 12% + CAGR. There is a huge potential for debt relief in this segment, from prevention to treatment of debt-laden consumers. ”