Mailchimp parent Intuit is acquiring SeedFi, a provider of technology that helps consumers attain financial stability. Terms were not disclosed.
The transaction is expected to close in the coming months, and will not have a material impact on Intuit’s full fiscal-year 2023 results, the firm says. .
Last year, SeedFi formed a partnership with Intuit’s Credit Karma through which Credit Karma members are offered SeedFi’s Credit Builder product.
The arrangement enables stressed consumers to make regular payments, as little as $20 per month or $10 per paycheck at the start.
“Credit Karma Money was built to change consumers’ relationship with money and help them develop responsible financial habits, like staying on top of their bills and spending within their means,” says Poulomi Damany, senior vice president and general manager for Credit Karma Money and Tax.
Damany adds that the company has "long-standing relationships with credit bureaus and others in the credit ecosystem," and says that combined with SeedFi's technology, the company will be able to accelerate its growth and "build products to help more members, including those who need it the most.”
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A study by the Consumer Financial Protection Bureau found a correlation between low credit scores and lack of savings. Nearly three-quarters of Americans with no emergency savings have credit scores below 660, the company reports.
The payments made by Credit Karma members are reported to the credit bureaus.
These members increased their score by an average of 21 points -- in some cases in 30 to 45 days -- and built up over $10 million in savings, the firm says.
SeedFi has been working with Credit Karma Money, a banking service, for over a year. SeedFi co-founder and CEO Jim McGinley says the company has a "mission to help consumers become financially fit."