Oportun to buy neobank Digit for $213 million

Oportun in San Carlos, Calif., has agreed to buy neobank Digit. 

Oportun said in a press release Tuesday that it will pay $212.9 million in cash and equity for Digit in a move designed to expand its A.I. and digital capabilities. The deal is expected to close by early next year.

Oportun said it had obtained a commitment to finance the cash consideration, noting that Jefferies had provided the financing commitment. 

The acquisition “will expand our addressable market, accelerate and diversify revenue growth, and position Oportun for even more future success,” Raul Vazquez, Oportun’s CEO, said in the release. “We are purchasing a proven and scalable neobanking solution that gets us to market [three to five] years earlier than if we were to build it on our own.” 

The deal comes less than two months after Oportun withdrew an application for a national bank charter from the Office of the Comptroller of the Currency. The company has said it plans to refile.

Digit, founded in 2013, provides its 600,000 paying members with personalized savings, investing and banking tools. The platform automatically sets aside funds for members by analyzing cash flow and recognizing how much can be saved and invested while remaining well within a member’s immediate financial means. 

Digit will operate as a business unit within Oportun and continue to be led by CEO Ethan Bloch. All of Digit’s more than 100 employees will join Oportun and continue their job functions. 

J.P. Morgan and Wilson Sonsini Goodrich & Rosati advised Oportun. Goodwin Procter and Financial Technology Partners advised Digit.