ClearScore Group gains embedded finance foothold with Aro Finance acquisition

Data-driven financial marketplace the ClearScore Group has acquired Manchester-based Aro Finance, its second acquisition and one which sees it expand into embedded finance and secured loan broking.

The transaction, which is pending Financial Conduct Authority approval, will see ClearScore diversify away from direct-to-consumer acquisition and adds a “significant” B2B2C channel through embedded finance working with UK retailers.

By adding secured loan brokerage to ClearScore’s core proposition, the acquisition also enhances the group’s capability in secured lending.

ClearScore’s proprietary technology platform matches users to credit cards, loans and car finance via a combination of credit and affordability data, facilitated through credit reports and Open Banking technology.

Aro operates a credit marketplace proposition embedded within affinity partners’ digital infrastructure, including Argos, Very.co.uk and Asda.

ClearScore’s existing financial services partners will provide more lending choices embedded in the retailers’ digital channels.

The acquisition of Aro Finance comes as ClearScore builds and scales its debt consolidation loan technology, ‘Clearer’, which allows direct settlement of consumer debts.

According to the Group, its latest proposition eliminates the risk that funds are not used to pay off existing credit cards and loans by automatically paying off the loans for the consumer, with users of ‘Clearer’ given access to both unsecured and – post the integration of Aro – secured loans.

Aro’s third offering is a point-of-need service to lenders, designed to help users who have been rejected for credit find suitable alternatives.

Emma Steeley, chief executive officer of Aro

Justin Basini, co-founder and chief executive officer of ClearScore, said: “This acquisition allows us to continue our growth by expanding into two complementary areas as a credit broker, namely embedded finance and secured second charge lending.

“Diversifying our channels to market, and product range we can offer to our 24 million users, as well as our offering to our lenders, is an important step in our strategy. We see a significant growth opportunity in second charge mortgages, and this will be a critical part of our debt consolidation proposition and business growth going forward.”

Basini added: “The addition of Aro’s marketplace capabilities to the Group perfectly aligns with our existing data-driven approach and will allow us to reach new users through retail channels.”

Emma Steeley, chief executive officer of Aro, said that by joining ClearScore, Aro will become part of one of the most innovative global organisations in fintech.

“It is an exciting new chapter for the business, ensuring that together we continue to grow and deliver exceptional value for our partners, lenders and customers,” she added.

“With the clear business synergies and strategic data-led approach, I am confident that we will continue to engage with and serve many more customers with the strong breadth and depth of our combined product offerings.

“I am immensely proud of what we have achieved at Aro, and I am looking forward to what the future holds under ClearScore’s stewardship.”

ClearScore made its first acquisition back in 2022, when it bought Money Dashboard, known for its ability to identify financial behavioural patterns using Open Banking.

The Group subsequently launched a B2B Open Banking and data insight unit, D•One.