Financial technology company Intuit has announced that it has agreed to buy Credit Karma for about $7.1 billion in cash and stocks.
Credit Karma, which provides free credit score monitoring for consumers, will be acquired by Intuit for approximately $7.1 billion.
The purchase of Credit Karma is seen as an expansion by Intuit further into consumer finance technology. Intuit is the creator of tax preparation software TurboTax, small business accounting software QuickBooks and personal finance manager platform Mint.
Founded in 2007, Credit Karma recommends financial products such as credit cards and loans based on consumers' financial data, and is paid through commissions on any sales.
According to a press release, the company posted nearly $1 billion in unaudited revenue during calendar year 2019, which is a 20% increase from the previous year.
Intuit said that the acquisition of Credit Karma is geared towards using its assets to create a digital personalized finance assistant. The technology will give users access to their personal finance information such as income and credit history, as well as information about financial products and other advice.
Intuit chief executive officer (CEO) Sasan Goodarzi said: "There's a lot of innovation and investment in FinTech, but we don't see anyone, with our collective capabilities, pursuing a personalized financial assistant to help consumers take control of their financial lives."
"We're going to bring together consumers and financial institutions in innovative ways that lower costs for all those involved and level the playing field for consumers regardless of their economic status. We believe we can transform the personal finance industry and power the economy," Goodarzi added.
The deal is expected to be completed by the second half of 2020, subject to regulatory approvals. It was announced in conjunction with its earnings report for the three months ending in January.
Intuit posted a revenue growth of 13% compared with the previous year. Following the announcement, the company's shares went up around 2% in after hours trading.
