Credit Karma Unveils New High Yield Savings Accounts

The 100 million members of Credit Karma will soon have access to more than just tools to better understand and improve their credit scores. The company announced this week that it is launching a new, high-yield savings account with no fees, no minimums and an initial rate of 2.03%. Credit Karma added that it will leverage its partnerships with as many as 800 banks to find and switch to those institutions offering the best rates on cash.

“We spent the first 12 years focusing on helping Americans manage their debt,” Credit Karma CEO and founder Ken Lin said. “We want to make savings accessible to every American in the same way we have with credit scores. We look forward to helping our members grow their money with Credit Karma Savings.”

Credit Karma will facilitate the opening and managing of the savings accounts, while the funds themselves will be kept and insured by FDIC-licensed partner MVB Bank to the tune of $5 million. The current rate offered by Credit Karma Savings is more than 20x the national average. The solution will be available via the Credit Karma app, and members can begin signing up for the new feature on October 28.

“When we built Credit Karma Savings, we wanted to develop a product that made opening a savings account as easy as possible for our members,” Credit Karma General Manager of Savings and Tax Jagit Chawla said. “We’re also making it possible for members to see the power of high-yield savings with our savings simulator, which shows how your money could grow over time.”

The move by the company comes as more fintechs are focusing on savings solutions as a way to add value to their personal finance or roboadvisory offerings. Companies like MaxMyInterest announced a few weeks ago that it is adding a high-yield checking account to its high-yield savings option. Other fintechs in the wealthtech space, such as Betterment and Wealthfront have also introduced high-yield savings options. We took a look at the way fintechs are innovating on the savings side in our feature by senior analyst Julie Muhn: The Race is On in the High Yield Savings Game.

Founded in 2007 by Ken Lin (CEO) and headquartered in San Francisco, California, Credit Karma demonstrated its technology at FinovateSpring 2008. One of Finovate’s earliest alums, the company began the year with news it had been added to the Forbes Fintech 50 roster of the most innovative companies in fintech.

Credit Karma has raised $868 million in funding. The company includes Silver Lake Partners, SV Angel, QED Investors, CapitalG, and Susquehanna Growth Equity among its investors.

Finovate Alumni News

On Finovate.com

  • Credit Karma Unveils New High Yield Savings Accounts
  • Finovate Global: PayPal Goes to China; Dubai Named Top Ten Global Financial Center

Around the web

  • Tradeshift to implement QEDIT’s privacy solution to preserve the full privacy of transactions.
  • Pendo Systems announces a new strategic partnership with Market Alpha Advisors.
  • Meniga to collaborate with Nordic Innovation House in Singapore.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Finovate Alums Shine in 2019 Forbes Fintech 50 Roster

A baker’s dozen of Finovate alums has been honored this week with spots on the 2019 Forbes Fintech 50, an annual aggregation of what the editors called “the most innovative companies in fintech.”

Here are the Finovate alums that made the cut. Read the full list.

“Recognition as a leading innovator in fintech is tremendous validation for the hard work we’ve done at Marqeta to open the industry up to the possibilities and opportunities of modern card issuing,” company CEO and founder Jason Gardner said. Marqeta is among the 20 companies to make its first appearance on the Forbes Fintech 50 roster.

Also earning their first appearances on Forbes Fintech 50 roster are New York based mobile investment platform Stash and San Francisco supply chain payments innovator Tradeshift.

“Very excited to be included in the 2019 Forbes Fintech 50!,” Stash tweeted once the news was released at the start of the week, “Monday = made.”

“We made the list!” Tradeshift tweeted this morning.

Summarizing this year’s selection of top fintechs, the editors noted that while 19 out of the 50 fintechs featured are unicorns with valuations of more than $1 billion, a nearly equal amount – 20 startups – are making their first showing on Forbes top fintech list. The two areas where newcomers were more prevalent, according to the editors, were payments technology and startups serving the un- and underbanked.

Credit Karma Acquires Noddle to Launch in the U.K.

Just a month after unveiling its new auto insurance tool, financial health company Credit Karma announced it is once again expanding– this time across country borders.

Prompting this move is the San Francisco-based company’s acquisition of Noddle, a startup headquartered in the U.K. that offers users free access to their credit report. Credit Karma made the purchase from TransUnion, which received Noddle as a part of its purchase of CallCredit for $1.4 billion in April of this year. The financial terms of the agreement are not disclosed but it appears to be purely cash-based; TransUnion is not taking any stake in Credit Karma. The deal is expected to close later this year or early next year.

“Noddle’s similar mission and history as the first provider of free credit information in the U.K. made this a clear decision for Credit Karma,” said Credit Karma’s VP of International, Valerie Wagoner. “We’re confident our depth of experience working across data providers along with banks and lenders will accelerate the number of services we provide to help consumers make the most of their money.”

Noddle’s 35+ employees will join the Credit Karma workforce of more than 700. Credit Karma has “immediate plans” to expand its team in the U.K., and aims to “more than double” the U.K. team– which will be based in London and Leeds– over the next year. The acquisition includes Noddle’s employees, technology, and clients– more than 4 million of them. This number boosts Credit Karma’s existing North American user base which currently sits at more than 85 million members.

Founded in 2007, Credit Karma CEO Ken Lin demonstrated the company’s platform at FinovateSpring 2009, when the company had just five employees. Since then, Credit Karma has finalized five acquisitions, making today’s purchase of Noddle its sixth. After receiving a $500 million secondary investment round in March, the company boosted its valuation to $4 billion.

Finovate Alumni News

On Finovate.com

  • Credit Karma Acquires Noddle to Launch in the U.K.

Around the web

  • Moneyhub announces integration with PensionBee API.
  • Outsystems unveils new program, outsystems.ai, to leverage AI and machine learning to improve software development.
  • Finastra introduces Open Banking Readiness Index for Asia Pacific region.
  • Trulioo reports ability to verify five billion people via its identity verification platform, Global Gateway.
  • Wipro collaborates with Check Point Software to offer cloud security services.
  • Unison expands with Goldwater Bank Partnership.
  • Flywire partners with the Dallas-Fort Worth Hospital Council to offer members payment solutions.
  • How I Built This podcast features Betterment founder Jon Stein.
  • Roostify names Courtney Keating Chakarun as new Chief Marketing Officer.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Finovate Alumni News

On Finovate.com

  • Finn AI Closes $11 Million Series A.
  • Plaid Signs Open Banking Agreement with JPMorgan.
  • Moven Enterprise Goes Global.

Around the web

  • Klarna pairs up with Rancourt to let shoppers pay over time.
  • Credit Karma launches new personalized shopping experience.
  • Temenos ramps up AI efforts to power its digital banking platform.
  • Feedzai launches AI-powered Feedzai Genome to help users visualize and fight financial crime.
  • Jumio stays ahead of fraudsters with certified 3D liveness detection.
  • Clover announces additions to its Partner Portfolio with enhanced integrations with Nav, AP Intego Insurance Group, and Gusto.
  • Ayondo forms white label agreement with Phnom Penh Derivative Exchange to provide TradeHub for derivative brokers trading CFDs for PPDE’s clients in Cambodia.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Credit Karma Goes for Insurtech

Consumer-facing financial health company Credit Karma unveiled plans for an auto insurance comparison tool. Starting today, members in California and Texas can determine if they are paying too much for car insurance based on how much similar members are paying for comparable coverage.

The move aims to help members make the best decision about their auto insurance, coverage that Credit Karma estimates Americans overspend on by $21 million each year. The new tool builds on Credit Karma’s Online Vehicle Center. Launched in November of last year, the Online Vehicle Center is an informational dashboard that helps consumers manage and organize their vehicle-related finances and information by leveraging driver and vehicle data from the DMV.

The Online Vehicle Center tool received significant traction since launching just under one year ago; more than 8 million members, 8% of Credit Karma’s total user base, have synced their vehicle information with the platform. The new comparison aspect of the tool leverages DMV information and combines it with data from credit bureaus and public insurance filings to estimate insurance quotes. Unlike traditional insurance quote comparisons, which require users to input 30 to 40 fields of data, Credit Karma generates a comparison in real-time.

“We built the auto experience to help put money back into the pockets of our members. With our refinance experience, we’ve helped our members save nearly $150 million on their auto loans in under a year,” said Kenneth Lin, founder and CEO of Credit Karma. “We plan to do the same for insurance.”

Another aspect of the new tool that’s worth mentioning is the education piece. Credit Karma will offer users an interactive experience that shows how certain factors such as moving violations and credit score can impact rates. The San Francisco-based company said that it plans to roll out the new tool to users in more U.S. states “in the coming months.”

At FinovateSpring 2009, Credit Karma CEO Ken Lin demonstrated the company’s platform, which offers free credit reports from Equifax and TransUnion, and seeks to serve as a hub for users to monitor their financial health. Since it was founded in 2007, the company has expanded not only into vehicle information management and monitoring but also identity monitoring and tax filing. Most recently, Credit Karma acquired mortgagetech startup Approved to move beyond its basic mortgage rates comparison tool.

Credit Karma Buys Mortgage Platform Company

Consumer credit monitoring and financial health company Credit Karma is furthering its reach into the real estate sector this week with the acquisition of mortgagetech startup Approved.

In a blog post yesterday, Approved Founder and CEO Andy Taylor announced that Credit Karma had acquired the three-year-old startup for an undisclosed amount. “Working with Credit Karma gives us the resources and immediate scale to accelerate our mission-driven work, reaching significantly more homebuyers than we could have imagined when we started,” Taylor said.

Credit Karma, which previously offered a basic mortgage comparison tool, is bolstering its capabilities with Approved at a time when many Millennials are beginning to purchase their own homes. As the company’s Chief Product Officer Nikhyl Singhal explained in an interview with TechCrunch, “As we’ve expanded, you’ve seen us move from credit cards as a way to help members with that part of their life to first personal loans to auto — meaning auto loans, auto insurance,” he said. “Today, we’re really talking more publicly about mortgage. Mortgage being for many of our members the most important financial decision they’ll make.”

Having facilitated almost $5 billion in loan originations, Approved was launched in 2015 by Taylor and co-founder Navtej Sadhal. The two met while working at RedFin, where they realized a need for disruption in the back-end of the mortgage process, where inefficiencies such as fax machines are still prevalent. Taylor vowed to stay true to Approve’s humble roots, adding, “We can’t wait to reveal what we’re working on next.”

Credit Karma already hosts many financial tools such as credit monitoring, tax filing, and credit card comparisons. By adding a more robust mortgage platform to this list, the company is creating a more sticky ecosystem with which to hook its 80 million users, half of which are Millennials.

At FinovateSpring 2009, Credit Karma CEO Ken Lin demonstrated the company’s platform, which offers free credit reports from Equifax and TransUnion, and seeks to serve as a hub for users to monitor their financial health. The company has facilitated the origination of more than $40 billion in credit products since it was founded in 2007. Earlier this year, the company teamed up with SpyCloud to help users determine if their data is being used on the dark web. Check out our recent interview with Colleen McCreary, Credit Karma’s first Chief People Officer.

Finovate Alumni News

On Finovate.com

  • Credit Karma Buys Mortgage Platform Company.

Around the web

  • Coin Telegraph: Ripple partners with three crypto exchanges as part of XRapid solution
  • Insuritas partners with Alabama One Credit Union and Alabama One Agency Insurance Services to provide insurance offerings for members.
  • figo receives ZAG license and enables ‘License as a Service’ through RegShield.
  • NPR features how PayActiv helps Americans avoid payday loans.
  • MX named one of fastest growing companies in Utah for 2018.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Credit Karma Hires Colleen McCreary as First Chief People Officer

Today, whether you are a small team in a backyard garage or the army of developers in the Googleplex, it is clear that building and sustaining a strong tech company is increasingly about building and sustaining a strong team. Colleen McCreary (pictured), the new Chief People Officer for Credit Karma, helps explain why this is so and how companies can make sure it happens.

Finovate: How long have you been at Credit Karma and what’s your background?

Colleen McCreary: I’ve been at Credit Karma for four months and have been working in various people/HR roles at tech companies for over 20 years. This is my fourth full-time role as a Chief People Officer. I started my career at large public companies but have spent the last decade focusing on scaling startups.

Finovate: Not every company has a Chief People Officer. When does a company know it’s time to hire one?

McCreary: I’m excited that I’m getting asked this question more often. There’s no perfect science, but you usually need someone in a senior capacity when your scale/growth has outgrown the basics you can read in a book. Because labor is usually your most expensive cost, at some point you want an expert who spends all their time thinking about it. Most of what a CPO brings is the ability to match behaviors with a toolbox of possible solutions.

 

Finovate: What are the challenges a Chief People Officer faces today compared to 5 to 10 years ago?

McCreary: In theory, people haven’t changed that much in terms of their motivation and desires. However, the big changes in the last five to 10 years have been around: 1) increasing employee confidence about vocalizing their opinions and concerns internally and externally, 2) rising expectations of career development/growth and a willingness to quickly move to another opportunity to find it, and 3) the rise of anonymous sites on the internet.

Finovate: What drew you to this field in general and why Credit Karma in particular?

McCreary:  I’ve spent my entire professional career in the technology industry because I love the pace of innovation and the impact it has on individuals and society. There’s nothing more impactful than the ability to gain financial independence. Credit Karma is at the intersection of all of this. However, most important to me was the amazing team that founded the company and the opportunity to work with someone as mission-focused as (CEO) Ken Lin.

Finovate: What skills are most important for a Chief People Officer?

McCreary: There are probably a lot of different answers to this, but when I coach other CEOs who are looking to hire a CPO, here’s my list:

  • Deep experience across multiple areas (recruiting, compensation, employee development, performance management)
  • A strong point of view and a willingness to share it and push back when appropriate
  • Orientation around using data to guide/influence decision-making
  • Strong operations experience
  • Ability to lead/coach people of all backgrounds
  • A thick skin and sense of humor because you can’t please everyone

Finovate: How does a Chief People Officer measure success in her role?

McCreary: From a metrics perspective, we tend to look at things like reduced regrettable attrition, manager effectiveness, offers accepted, NPS (net promoter score) as an employer, etc. However, I think there are some less measurable aspects around employee willingness to vocalize opinions publicly, perceptions of accountability, and overall employee trust in leadership.

Finovate: Thank you for your time.

With more than 80 million members across the U.S., Credit Karma offers free credit scoring, monitoring, and reporting to help consumers better manage their debt. Credit Karma helps users of its platform understand how their credit scores impact their ability to get loans and provides personalized recommendations to help consumers save money and use credit more wisely.

One of Finovate’s earliest alums, Credit Karma demonstrated its Debt Manager solution at FinovateSpring 2009. The company was founded in 2007 and is headquartered in San Francisco, California.