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Klarna said it wouldn’t share data about the bulk of its loans with credit bureaus until it gets assurances that its customers won’t be unfairly penalized for using its payment options. BNPL provider Afterpay has also stated that it plans to withhold data until it has proof that its customers won’t be harmed.
Earlier this year, Affirm became the first major BNPL provider to start sharing all consumer data with credit bureaus Experian and TransUnion. Klarna, meanwhile, reports data on its longer-term interest-bearing loans, but not the “Pay-in-4” installment plans that make up most of its U.S. business. Credit bureaus haven’t yet made that data visible to lenders or included them in credit scores, but TransUnion said it would be ready to do so in the coming months. Current scoring models penalize borrowers for opening several new lines of credit in a short period. FICO’s new model groups together multiple BNPL loans so that using several in a short period of time doesn’t ding your score as much as opening a bunch of credit cards or personal loans.
https://www.wsj.com/personal-finance/credit/klarna-credit-bureau-customer-data-f07925c7?st=ume9et
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