- Key insights: CardWorks subsidiary Merrick Bank relaunched the Ollo Credit Card, a portfolio it acquired from Ally Financial at the beginning of 2025.
- What’s at stake: The relaunch ends a five-year dance between the two companies that first had Ally buying CardWorks for $2.7 billion.
- Forward look: The acquisition bumped up Merrick’s credit card portfolio by nearly 50%.
CardWorks subsidiary Merrick Bank has officially relaunched the Ollo credit card, a portfolio of five credit cards the lender acquired from Ally Financial at the beginning of the year.
The $2.2 billion acquisition of the near-prime portfolio in January ended a half decade saga that started with Ally Financial initially agreeing to buy Cardworks for $2.7 billion.
The timing was never right. In February 2020, just ahead of the COVID-19 pandemic, Ally Financial said it would
By June, that
In the years between, the two companies stayed close. CardWorks continued to service Ally’s credit cards – which it had been doing since 2017 – and in 2021 Ally acquired Fair Square Financial and the Ollo credit card, its 86 employees, 693,000 cardholders and $816 million in loan balances.
But the credit card business didn’t quite work out for Ally. By the end of 2024, Ally was
For Merrick, the acquisition of the Ollo portfolio represents an opportunity for the traditionally nonprime lender to move up the credit spectrum and expand its card portfolio to a new base of users. In addition to its Platinum, Everyday Rewards and Select Rewards credit card products, Ollo has rewards cards targeted at nurses and educators.
“Our portfolio of credit cards prior to the Ollo purchase was pretty much organically grown from the beginning,” Brian Jones, president of Merrick Bank, told American Banker. “We have had over the years a few portfolio purchases, but none that were as sort of transformative and big as the Ally card purchase.”
Merrick has historically been an invitation-only credit card issuer focused on nonprime consumers with an average FICO of 615. It is the 19th largest credit card issuer, the 12th largest merchant acquirer with about 150,000 merchants, and one of the largest private independent credit card servicers in the U.S., according to the company.
The Ollo acquisition not only increased the size of Merrick’s overall portfolio by nearly 50% to $8.9 billion, but it also pushed up the lender’s profile to now serve customers with credit scores as high as 740, according to the company. Merrick previously lent to customers with credit scores as high as 700.
Nonprime consumers are usually pretty profitable for lenders, Eric Grover, principal of Intrepid Ventures, told American Banker. “It’s not a bad place to play … as long as [
There’s still work to be done for Merrick as it integrates the card into its tech stack. The bank completed the bank identification number transfers in late September, and earlier this week began new cardholder acquisitions through affiliate marketing on Credit Karma, Credit Sesame, Experian Right Offer and pre-approved direct mail offerings by invitation only. Backbook portfolio rebranding is expected to begin in January 2026, and finished by July 2026.
Looking ahead, Merrick can see the Ollo card portfolio move further up the credit spectrum, but not so far up to compete with the likes of the large, national issuers, Scott Bourdreau, EVP and head of credit cards at Merrick, told American Banker. Bourdreau was one of the founders of First Square in 2017.
“From a target market perspective, we don’t have an aspiration to get into the rewards wars with the JPMorgans and Bank of Americas and Citibanks fighting for the 760-plus FICO population,” Bourdreau said. “They just have too many entrenched advantages to win in that very low margin space. But I would see us moving up the credit spectrum more into what I would describe as the low prime kind of space.”