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Experian to add buy now, pay later data to credit files

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Experian has confirmed it is looking to add buy now, pay later data to credit reports later this year.

The credit reference agency said it is working with buy now, pay later (BNPL) providers to include information on files.

It follows in the steps of TransUnion which earlier this month announced it will add information to “protect customers” and “enable finance providers to have a better picture of their affordability”.

The data will be phased in from summer 2022, following the unprecedented growth in the sector during the Covid pandemic.

Interest-free BNPL schemes are a form of credit and give customers the opportunity to buy something now and pay for it later. But if the debt isn’t cleared, interest and other charges add up.

Following the sector’s growth, the regulator, the Financial Conduct Authority said the payment services will come under its scope, and a review also highlighted the potential risk of consumer detriment in using this option.

James Jones, head of consumer affairs at Experian, said: “We are working with BNPL providers to include these agreements in Experian credit reports later this year.

“Like any form of credit, if you manage BNPL responsibly it can provide a helpful way of spreading the cost of products and services – if you don’t borrow more than you can afford to repay and you do meet any agreed payments on time and in full.

“Like other credit, missed payments could result in extra charges and could, in time, affect your creditworthiness in the eyes of other lenders.”

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