Credit Karma

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IndustryPersonal finance, Software
HeadquartersSan Francisco, California
Key peopleKenneth Lin, CEO
Productscredit scores
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IndustryPersonal finance, Software
HeadquartersSan Francisco, California
Key peopleKenneth Lin, CEO
Productscredit scores

Credit Karma is a San Francisco-based credit and financial monitoring website founded in 2007. Credit Karma provides the TransUnion's TransRisk New Account Score generated from national credit bureau TransUnion,[1] the VantageScore, the TransUnion Auto Insurance Risk Score[2] and the TransUnion Home Insurance Risk Score.

Credit Karma offers credit tools like the Credit Report Card, which summarizes a consumer’s credit report into components graded with an A-F letter grade, the Credit Score Simulator, which simulates the effect of certain financial actions on credit scores, and free credit monitoring, which alerts users to important changes on their TransUnion credit report.[3]

In addition to providing free credit scores, Credit Karma also offers free financial account monitoring as of April 2013. Members can connect their online accounts – including bank accounts, credit cards, savings accounts and loans – and sign up to receive email alerts when a bill is due or when unusual transaction activity occurs.[4]

Credit Karma also offers a free mobile app for both iPhone[5] and Android. Using Credit Karma Mobile, consumers can monitor their credit on-the-go by receiving credit monitoring alerts straight to their smartphone.

Founder and investors[edit]

Kenneth Lin, who previously worked with E-Loan and Upromise, launched Credit Karma in February 2008.[6] The start-up was primarily funded by investors Chris Larson, CEO of Prosper, and Mark Lefanowicz, former president of E-Loan.[7] In 2009, Ron Conway, Dave McClure, and QED Investors made additional investments in Credit Karma.[8] In 2013, Credit Karma secured $30 million in Series B funding from Ribbit Capital and Susquehanna Growth Equity.[9]

Credit Karma’s credit scores[edit]

Credit Karma provides users with TransUnion’s New Account score model, which is used by dozens of credit monitoring sites. The New Account score model ranges from 300 to 850, which is the same scale as the FICO Score, the credit score most familiar to consumers. Credit bureau scores, like Credit Karma's, can differ up to 50 points between credit bureaus,[10] but Credit Karma's credit score is asserted to be highly correlated to the FICO score.[11]

In January 2011, Credit Karma's new Score Center page also began providing the VantageScore and TransUnion Auto Insurance Risk Score free to its members.[2] In April 2013, Credit Karma began offering its members TransUnion's Home Insurance Risk Score along with the launch of its financial monitoring platform.[12] These three new credit scores offer consumers additional insights to get a better idea of their general credit situation.[13]

Credit Karma Insight[edit]

In April 2013, Credit Karma launched Insight, an online platform that shows consumers their financial accounts and credit data all in one place, all for free.[14] It was the first of its kind to offer a full-fledged financial picture. With Insight, consumers can monitor both their credit data and their financial accounts and transactions all using Credit Karma's tools and high-tech data analysis.

Business model[edit]

Credit Karma's business model involves highly targeted and data-driven advertising. Revenue from these advertisements offsets the costs of free credit score tracking and financial account monitoring for Credit Karma members so the service is free to consumers.[15] Additionally, the offers shown through Credit Karma are highly tied to the logged-in users' credit and financial data, giving users the top recommendations possible for their financial situation.

Credit Karma keeps users’ personal information private and does not store personal sensitive account information on its site.[16] As of 2013 Credit Karma sells users personal information to credit card companies even if the user does not apply for a credit card.

See also[edit]


  1. ^ "Credit Karma Free Credit Score Service Can Help You In This Economic Environment: An Interview with CEO Ken Lin". The Sun's Financial Diary. 2009-03-11. Retrieved 2010-06-24. 
  2. ^ a b "Credit Karma Launches Two New Free Scores for Consumers". Marketwire. 2011-01-06. Retrieved 2011-03-04. 
  3. ^ Unveils First Free Credit Monitoring Service:
  4. ^ Credit Karma Debuts First-Ever Platform That Gives Consumers Their Full Financial Picture:
  5. ^ Credit Karma Launches The First Truly Free Credit Monitoring iPhone App:
  6. ^ Irby, LaToya (2008-09-22). " Offers Free Credit Score". Archived from the original on 2012-01-12. Retrieved 2010-06-24. 
  7. ^ Levinson, Rick (2009-06-09). "Credit Karma Introduces Free Credit-Card, Debt-Tracking Tool". Bloomberg L.P. Archived from the original on 2012-01-12. Retrieved 2009-07-27. 
  8. ^ Kincaid, Jason (2009-11-04). "Credit Karma Raises $2.5 Million To Take The Mystery Out Of Credit Scores". TechCrunch. Archived from the original on 2012-01-12. Retrieved 2010-09-02. 
  9. ^ Credit Karma Secures $30 Million in Series B Funding:
  10. ^ "How Accurate Are Credit Score Estimators?". The Consumerist. 2009-04-25. Archived from the original on 2012-01-12. Retrieved 2011-03-04. 
  11. ^ "Sites offer free alternative to FICO scores". Chicago Tribune. 2010-03-25. Archived from the original on 2012-01-12. Retrieved 2011-03-04. 
  12. ^
  13. ^ "Want a free VantageScore?". Bankrate. 2011-01-05. Archived from the original on 2012-01-12. Retrieved 2011-03-04. 
  14. ^
  15. ^ Retrieved "Credit Karma FAQ: Charge" (11-10-2008)
  16. ^ "Credit Karma FAQ:Shared Info" Retrieved (11-10-2008)

External links[edit]