C&R Software, a debt collection and recovery solutions software company, has agreed to acquire financial wellness fintech SpringFour, expanding the business scope of both companies. The fintech announced on Wednesday.
“Financial strength and financial health resources are becoming increasingly important and this is a way for us to rapidly expand and grow SpringFour and bring SpringFour to more businesses. [and] “More organizations,” SpringFour CEO Rochelle Nawrocki Gourley told Banking Dive, “more people will be able to get the help they need and deserve.”
Negotiations began in December and the deal closed last week, Gourley said, and the process of introducing the new company to clients has begun.
SpringFour aims to go beyond technological solutions to this job and add a more human element. C&R Software has proven to be a highly innovative company and its acquisition will enable SpringFour to continue to innovate and bring new solutions and products to the debt collection market, Gorey said.
Gorrie said C&R has “empathy” for people experiencing financial difficulties and that its interests are aligned with Springfort’s.of.
Springfor, a Chicago-based company that connects clients in need of financial assistance to nonprofit and government resources to help them get back on their feet, will operate as a standalone brand following the acquisition, with Gorrie continuing to lead the company.
Rochelle Nawrocki-Gourley, CEO, SpringFour
Used with permission from SpringFour
“My goal is to change the industry and I think this acquisition is a huge demonstration of that. I’m very excited about it,” Gourley said.
C&R’s operations span North America, the UK, Western Europe, South Africa, Asia Pacific, Australia and New Zealand, with the largest client base in the United States.
C&R Software CEO Ed Wallen said the acquisition is an opportunity for growth in terms of its overall customer base. The debt solutions platform has more than 550 customers in 62 countries. The company plans to focus its SpringFour platform offering on its top 50 customers, primarily large enterprises, to make the biggest impact soonest.
“From a business perspective, this really fits into our strategy of bringing more products and services back to our existing customer base,” Warren told Banking Dive.
C&R Software is a subsidiary of Constellation Software. Constellation is one of the world’s largest acquirers of vertical market software companies, with a market capitalization of about $80 billion. The company’s network spans more than 100 countries and has 1,300 subsidiaries, but all of the subsidiaries are run independently and decentralized, he said.
Leverage bank partnerships
Through C&R’s ownership, fintech companies can leverage their vendor relationships, and C&R can make the master services agreement process easier for SpringFour, Warren said.
For banks, “it’s very difficult to come on board as a vendor and get a master services agreement to do business with them. What this acquisition really means is that it gives SpringFour access to our entire C&R client base without them having to jump through all those hurdles,” he noted.
Following the transaction, Springfort and C&R will have access to their respective banking partners, with whom there is significant overlap, Warren said.
“We think the biggest opportunity here is getting SpringFour noticed by C&R’s customer base and really solving the problem of under-distribution of a great platform,” Warren said.
He also said Constellation has a buy-and-hold policy, meaning Springfor has found a forever home, and that the two companies plan to grow together.
SpringFour recently launched its Cincinnati-based Fifth Third Launching eBus to re-envision lending institutions and reach underserved communities. SpringFour also works with banks such as BMO, Capital One, KeyBank, and M&T Bank.
SpringFour’s Global Expansion
Warren sees opportunities to expand into other developed countries with social security systems, such as Canada, the UK, Australia and New Zealand.
The U.K. has “consumer duty” regulations from the Financial Conduct Authority that require financial institutions to treat customers well and help them get back on track, and such regulations are being introduced in other countries and will benefit companies that serve people in financial difficulty, he noted.
“This impacts the consumer as a whole because it lowers the cost of credit, it expands access to credit and everybody benefits, so it’s not just about those in need,” Warren said. “This can impact the consumer as a whole.”
