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Experian is to debut a buy now, pay later credit bureau this spring, providing lenders with real-time data on customer spending and loan repayments without impacting credit scores.
The service is aimed at providing a distinct source of data relating to BNPL-only debt, reflecting its unique characteristics as opposed to traditional credit lines.
As a standalone entity, Experian hopes to provide a more nuanced overview of customer behaviour, and one that does not have a negative impact on consumer credit scores, seens as a major barrier to credit reporting by BNPL firms.
Currently, the lack of consumer insights on BNPL loans introduces risks and challenges for lenders during credit decisioning – including mispricing credit risk, inaccurately forecasting consumer capacity, and meeting compliance requirements related to undisclosed debt.
Experian says its upcoming Buy Now Pay Later Bureau will provide visibility into BNPL activity and deliver advanced analytics based on millions of BNPL credit records. The firm says it has partnered with some of the largest BNPL providers to draw on tradeline data and records.
Along with providing insigths into consumer’s total debt across multiple providers, the data record will also provide a more informed view of customer repayment behaviours, providing lenders with the opportunity to serve thin-file customers who would have otherwise been denied credit.
Financial Services
