Amid slumping first quarter sales, Signet Jewelers on Thursday announced the first phase of the strategic outsourcing of its in-house credit program, in partnerships with Alliance Data and Progressive Leasing, a subsidiary of Aaron’s.

The jeweler, whose banners include Zales, Kay Jewelers and Jared the Galleria of Jewelry, will outsource its in-house credit portfolio in two phases. In the first phase, Signet will sell $1.0 billion of its prime-only credit quality accounts receivable to Alliance Data Systems Corp. Additionally, under a seven-year agreement, Alliance Data will become the primary provider of private-label credit card services and associated card marketing and servicing functions to Signet USA’s brands. Signet will retain the existing non-prime accounts receivable on its balance sheet and continue to originate new accounts, while outsourcing the credit servicing functions of those accounts to Genesis Financial Solutions for an initial term of five years.

In addition, Signet will form a seven-year partnership with Progressive Leasing, a subsidiary of Aaron’s, to provide a lease-purchase payment program to Signet customers who do not qualify for Signet’s credit programs, or do not wish to pursue a credit option…