Founded in April 2019, INDmoney is a fintech platform that is planning to offer US stocks to its customers as rewards for their credit card spends.

To avail this benefit, the customers of INDmoney needs to open a rupee account on the app, which would be maintained with the partner bank of INDmoney in India. Ashish Kashyap, Founder and CEO of INDmoney said that a satisfactory deal with the partner bank and the usage of technology has excluded the high fixed charges allied with small forex transfers. Hence, the customers can pay even small amounts of money to a US broker that INDmoney has partnered with for a very small markup and thus, can buy US stocks and bonds.

The US approves the holding of fractional shares, making the credit of stocks with small amounts possible. Kashyap said, “The new rewards programme is one step forward. It credits fractional US shares to the brokerage account of customers (with Drivewealth) linked to the credit card spending of customers. In addition to what that person would get from his/her credit card provider is roughly in the region of about 1-1.5% reward for the monthly spend. The credit card statement of the customer gets automatically dragged from their email account on the basis of customer consent. Besides, there is no need for the customer to upload it every month.”

For instance, if a customer who spends Rs. 1 lakh per month on the credit card, he/she will receive US stocks worth Rs. 1,000-1,500 in the US brokerage account. Kashyap says that the rewards are capped at Rs. 200 per month.

Is INDmoney Charging any Money for the Service?

INDmoney is not charging anything for their service. Kashyap said, “We aim to make investing in India as well as global markets at zero percent commission and the company would like to continue this way as our business model is freemium.”  While INDmoney’s all these services are free, a certain percentage of people convert to become their ‘Gold members’ to access a host of premium services.

Customers opting for the services offered by INDmoney should take note of two important aspects.

First, INDmoney is only facilitating the investment.

Second, the holding of US stocks brings out an added compliance requirement with regards to unveiling both the investment value as well as any income from it in the income tax return in India.

The investor is reliant on the US broker as the stocks are credited to a US brokerage account. For customer service, INDmoney has a dedicated team. “Since INDmoney is a platform and not a broker, the US brokers are connected with the local banking channel. US stocks of consumers are managed by DriveWealth and other similar brokers, and they get a distinctive account with this entity,” said Kashyap.