uPromise Sold to Sallie Mae

The internet has been a-buzz for the past week or so with the news that Mastercard has entered into an agreement with uPromise to offer a debit rewards card, with 1 to 5% of all debit card purchases sent to the owner's uPromise account.

Today's news is even bigger: It was announced today that uPromise would be sold to student loan provider Sallie Mae for an undisclosed price. The sale isn't expected to be finalized for a few months as there are some regulatory hoops they have to jump through.

uPromise, founded in 2001, has 250 employees and 7 million members, and it administers "nearly 1 million" college savings accounts (I guess that means the other 6 million folks choose to just receive a rebate check). They have contracts with seven states to administer their Section 529 plans (the article I read said that it is the largest administrator of these plans...more info on what they are and how they work is here).

Sallie Mae has 10 million borrowing customers, has been around since the early '70s, and started out as a government-sponsored student loan company that became privatized in 2004. My husband will be paying them until the end of time, I think. Ah, the price of higher education. Anyway, they're not going to change uPromise's name, and this is supposed to be a good thing for uPromise, as Sallie Mae has relationships with 6,000 colleges and universities. No worries, mates.

The official news release on this is here.