msmtp: sendmail: account default not found: no configuration file available (system wide configuration)

I am trying to setup Ubuntu 20.04 with msmtp as a system configuration.

I installed msmtp (v1.8.6-1) and heirloom-mailx (v12.5-2+deb7u1build0.14.04.1).

Config file /etc/msmtprc (chmod: 600) has the following:

# Set default values for all accounts.
account default
auth           on
tls            on
tls_trust_file /etc/ssl/certs/ca-certificates.crt
logfile        /var/log/msmtp

# gmail
host           smtp.gmail.com
port           587
from           <account>@gmail.com
user           <account>
password       <password>

# Syslog logging with facility LOG_MAIL instead of the default LOG_USER
syslog LOG_MAIL

Log file /var/log/msmtp file mode is 660.

File /etc/mailrc (chmod: 600) contains the following:

set sendmail="/usr/bin/msmtp"

When I try to use sendmail to send an email from terminal I get the following sendmail: account default not found: no configuration file available.

The same error comes up if I directly invoke msmtp.