On 9 February 2021, Laybuy’s website featured a page titled “Your Profile” with text that stated “… tell us a bit about yourself so we can do a secure credit check – it’s quick and doesn’t impact your credit score”.

But a borrower, who believed their credit score had been affected by Laybuy’s credit check, complained to the regulator that the statement was misleading.

Laybuy said that the claim “doesn’t impact your credit score” had appeared by mistake on its website and had been removed before the company was made aware of the complaint by the ASA.

Laybuy said it would ensure its future marketing communications were “subject to improved internal processes and controls”, and that it was “working with credit report providers to reverse the impact of its credit searches on affected consumers”.

The ASA investigated the issue and upheld the complaint. It considered that consumers would interpret the claim “we can do a secure credit check – it’s quick and doesn’t impact your credit score” to mean that before using Laybuy’s service they would be subject to a credit check, and that credit check would not result in any material change to their credit report score.

The complainant provided a copy of their credit report to the ASA which noted that an entry in the report from 9 February 2021 showed that a credit check had been performed by Laybuy. The regulator also noted that explanatory text on the entry stated “Can impact your Experian Credit Score” and that the complainant’s credit score had dropped since the check had been carried out.

The ASA said that while credit scores were complex, Laybuy had not provided evidence that its credit check wouldn’t have any consequences or impact on the complainant’s credit score, or on other consumers’ credit scores.

The regulator concluded that the claim “doesn’t impact your credit score” was misleading and breached the advertising code. It ruled that the ad must not appear again in the form complained about and told Laybuy that future marketing communications should not claim that credit checks would not affect consumers’ credit scores if that was not the case.

The ASA announced it would clampdown on BNPL advertising last year, saying that adverts must make it clear that BNPL borrowing was a form of credit.