Doorstep lender Morses Club is to enter the current account market after acquiring U Account in a deal which could be worth up to £11m.
Leeds-based Morses, the UK’s second largest home collected credit lender, said the acquisition of U Account is an important step in the company’s strategy of building a digital offering to allow its customers to access credit flexibly in a significant growth segment of the market.
Based in Sheffield, U Account is a digital current account provider offering an alternative to traditional banking by providing a fully functional agency banking service. As well as providing card services with its current accounts through contactless Mastercard debit cards, U Account also offers in-app features and functionality to help customers manage their finances more effectively.
Like Morses, U Account focuses on customers who are underserved by traditional banks, offering a current account banking service that enables customers to receive wages or benefits directly, manage their outgoings, and avoid bank charges. U Account customers can also deposit cash at one of PayPoint’s 28,000 terminals across the UK and earn rewards from recognised retailers.
As part of the transaction, Morses Club has acquired U Account’s technology and e-money banking platform, as well as its 20,000 current active customers.
Paul Smith, Chief Executive Officer of Morses Club, said: “This acquisition represents a fantastic opportunity to enter the rapidly growing online banking market. U Account features the full suite of digital banking services and has grown its customer base to c.20,000 active customers. U Account’s offering is highly complementary to that of Morses Club, and through this acquisition we expect to deliver significant synergies and cross selling opportunities.
“This is another exciting step for Morses Club as, consistent with our stated strategy, we continue to diversify our product offering to serve a broader range of customers across the non-standard credit space. Our differentiated use of technology and innovation enables Morses Club’s customers to access a broader range of more flexible and suitable credit.