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Intuit has agreed to acquire Credit Karma for approximately $7.1 billion in cash and stocks, the companies announced Monday.
Intuit () is the maker of tax preparation software TurboTax, small business accounting software QuickBooks and personal finance manager platform Mint. The acquisition of Credit Karma pushes Intuit further into the world of consumer finance technology.
Credit Karma, founded in 2007, provides free credit score monitoring for consumers. In exchange, it makes money by recommending financial products such as credit cards and loans based on those consumers’ financial data, and earns commission on any sales. The company made nearly $1 billion in unaudited revenue during calendar year 2019, up 20% from the previous year, according to a Monday press release.
Following the acquisition, Intuit said it plans to use Credit Karma’s assets to create a digital personalized finance assistant, a platform that gives users access to their personal finance information such as income and credit history, as well as information about financial products and other advice.
“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,” Intuit CEO Sasan Goodarzi said in the release. “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.”
As more and more financial transactions occur digitally, access to consumers’ financial data is highly valuable. Last month, another fintech startup that handles consumer financial data, Plaid, was bought by Visa () for $5.3 billion.
The Intuit-Credit Karma acquisition is expected to close in the second half of 2020, subject to regulatory approvals.
Intuit announced the deal at the same time it reported earnings for the three months ending in January, including revenue growth of 13% from the prior year. The company’s shares were up around 2% in after hours trading Monday.