A Wilmington-based company announced the market launch of new consumer credit cards under the Ollo brand. The cards will serve a subprime credit card market that has been in decline since the financial crisis. The subprime market has been heavily monitored by banking regulators.
According to the company’s website, the cards carry a nearly 25 percent annual interest rate. Cardholders paying that interest rate typically have no credit record or lower credit scores. The average national credit card interest rate runs about 15 percent.
Newly-formed Fair Square Financial Holdings, received what was described as a substantial equity commitment to finance card issuance from Pine Brook, a New York investment firm with $6 billion in investments. Fair Square lists a staff of 18 on is LinkedIn site.
On Monday, the Council for Development Finance approved a Performance Grant from Delaware Strategic Fund for up to $779,025. The council’s recommendations go to the head of the Delaware Economic Development Office.
The council’s recommendations go to the head of the Delaware Economic Development Office.
Fair Square Financial is led by Chief Executive Officer Rob Habgood, Prior to his new role, Habgood co-led the credit card business of Bank of America. Previously, Habgood held various senior roles at Capital One, and led the launch and expansion of Capital One’s consumer credit card business in the U.K. That business has 4 million customers.
“Almost a decade after the financial crisis, millions of Americans are still limited in their access to competitively priced card products,” said Habgood. “We believe there is an opportunity to better meet the credit needs of hard-working Americans while helping them achieve their financial goals.”
“We’re excited to have a board of directors and a management team with the depth and breadth of industry experience that is fundamental to successfully launch and manage a credit card business. We are combining industry-proven credit card expertise with advanced analytics and technology to deliver innovative and transparent products to serve our customers’ borrowing and payment needs,” Habgood continued. “We also are thrilled to be supported by Pine Brook, a firm with a 10-plus year track record of partnering with experienced management teams to build successful financial services companies.”
Fair Square’s board is comprised of industry veterans.
- Vikram S. Pandit, the former CEO of Citigroup and previously President and COO for the institutional securities and investment banking businesses of Morgan Stanley, has been appointed to the board of directors.
- Steven Freiberg was formerly CEO of E*Trade and held a number of senior positions at Citigroup, including CEO, Global Consumer Group and CEO, Global Card Products, and also serves on the Board of MasterCard. Freiberg will serve as Chairman of the Board.
- Also joining the board is Ajay Mookerjee, an e-finance entrepreneur and experienced credit card executive from Capital One, GE, Suntrust and Booz Allen and current advisor on financial services strategies for Warburg Pincus.
In addition to its investment in the company, Pine Brook is working with the management team and the board on Fair Square Financial’s strategy. Pine Brook Co-President William Spiegel and Managing Director Oliver Goldstein also serve on the Fair Square Financial Board.
“We believe Fair Square Financial’s new credit offering will meet the needs of a large population of previously underserved consumers,” said Spiegel. “We share Rob’s vision for the business and are confident that he and his team have the knowledge and experience to make Fair Square Financial a success,” said Goldstein.
Joining Habgood on the senior management team are Chief Risk Officer Scott Bourdreau, previously Consumer Credit Risk Executive at Bank of America; Chief Marketing and Product Officer Florian Egg-Krings, previously Managing Director, Credit Card Services at JP Morgan Chase; Chief Financial Officer Steve Linehan, previously EVP, Treasurer at Capital One; Chief Operating Officer Rick Welsh, previously Card Operations Executive at Bank of America; and General Counsel and Chief Administrative and Corporate Development Officer David Tyler, previously Chief Bank Business Risk Officer at Capital One.
