By Cat Rutter Pooley
Experian, the credit data company, is snapping up the millennial-focused fintech group ClearScore for £275m in a move to capitalise on the start-up’s success in matching members lured by its free membership model with financial products providers that pay it a fee.
Launched in July 2015 and backed by venture capital firm QED Investors and “digital venture builders” Blenheim Chalcot, ClearScore offers its customers access to their credit score and report through a “personal dashboard” online and through an app.
It provides a range of slick, snappy guides to personal finances and credit generally targeted at more inexperienced borrowers, although alongside titles such as “7 money mistakes millennials tend to make”, it also publishes “Everything you need to know about getting a second mortgage” and “What’s the ideal number of credit cards to have?”.
ClearScore says it can take into account its members personal credit history to show them offers with “personalised recommendations together with [their] chance of being accepted”. That offer has helped it enroll more than 6 million people in the UK to its service, according to Experian.
Experian chief executive Brian Cassin said on Thursday: “In acquiring ClearScore, we will take another important step in our strategy to extend the services we provide to UK consumers. Our goal is to provide more choice and greater convenience to individuals who want access to personal financial products at the best prices, while also making it easier for credit providers to offer better, more tailored offers to consumers. We look forward to welcoming the ClearScore team to Experian and to including the ClearScore brand as part of our broader offer.”
There is also an additional earnout payable on top of the purchase price contingent on financial targets being met. The deal— which is being financed through existing borrowing facilities — still has to be approved by the competition authority and the financial services watchdog, and is expected to close later in 2018, Experian added. One-off costs from integrating ClearScore are expected to be around $20m, with annual synergies of around $25m.