Intuit closed a deal to buy Credit Karma for a price tag of $7.1 billion on Monday (Feb. 24), according to published reports.
The bookkeeping software titan will now add the personal credit score website to its roster among other names like Quickbooks, TurboTax and more. The company is now worth more than $74 billion.
Consolidation of this kind has been sweeping the financial technology sector as of late, with Intuit's deal just the latest example. The deal lays bare the growing need for financial services groups to accumulate data.
Sasan Goodarzi, Intuit chief executive, told the Financial Times the acquisition would only help them give customers a personalized financial experience that could help them find the right products for their needs. He said the impact would be felt as customers had more money in their pockets and better ways of receiving advice.
The merger was touted as a good thing because it could help both Intuit and Credit Karma boost their total mass of data, which could, in turn, allow both companies the ability to help people in more specific manners.
Credit Karma generated around $1 billion in revenue last year. The company was considering exploring an initial public offering, but after watching other tech companies try that, Credit Karma opted for a sale instead.
Lately, banks, payment processors, brokerage firms and others have been scrambling to acquire startups and companies considered disruptive or innovative in the field. Last year, there was a total of $200 billion in deals similar to Intuit's recent takeover, in which financial technology firms were involved, according to investment bank Financial Technology Partners.
One of those deals involved Fidelity National Information Services' purchase of payment processor Worldpay for around $50 billion. Another saw Fiserv taking over rival First Data for $46 billion. Global Payments spent $27 billion doing an all-stock buyout of TSYS. And this year already, Visa paid $5.3 billion to acquire Plaid, which helps fintech companies connect with customers' bank accounts.