Experian’s proposed takeover of ClearScore could be blocked by competition watchdog

Removing one of the firms from the market could reduce pressure on companies to innovate and improve services

The CMA said the credit score checking market was ‘fast-paced and evolving’ (Getty Images/iStockphoto)

The competition watchdog has raised concerns over Experian’s proposed takeover of ClearScore, saying it could result in less competition and harm the development of digital products which help people understand their personal finances.

The Competition and Markets Authority began an in-depth phase 2 investigation into the deal between the credit score checking firms in July this year, after concerns that the merger could have a negative impact on services available to customers.

In its provisional findings, released on Wednesday, the CMA said competition between the two firms currently is “helping to drive quality and innovation in both free and paid-for credit checking services as they develop their products to vie for customers”.

Removing one of the competitors from the market, the CMA said, would “substantially reduce the pressure to continue to develop innovative offers and to make other improvements in services”.

Roland Green, the CMA inquiry chair, said: “Our investigation has shown that this is a fast-paced and evolving market, and that both Experian and ClearScore are an important part of that.

“The provisional findings in our investigation show that Experian’s proposed takeover of ClearScore is likely to weaken competition in the sector and have a negative effect on the services offered to customers.”

A spokesperson for Experian said the company was “disappointed” by the CMA’s provisional findings.

“We continue to strongly believe that the acquisition of ClearScore will have a positive impact on competition, allowing Experian to help more consumers with their finances by providing greater choice and convenience to them to access personal finance products at the best prices,” he said.

“We also believe we will be able innovate more and better through the combination of the parties’ complementary assets and innovation cultures. We will continue to engage constructively with the CMA over the weeks ahead to seek to address its concerns ahead of publication of the CMA’s final report early in the new year.”

The CMA has asked for views on its provisional findings, to be provided by 19 December. The watchdog said it will assess all evidence before making a final decision on the deal early next year.