||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||| |||||||||||||||||||||||||||||||||| Consumer Credit As the data becomes more widely
incorporated, this is likely to evolve and we’ll be working closely with fi nance providers and industry bodies and updating our scoring mechanisms as needed. Credit plays a key role in economic
recovery and our latest research shows a renewed appetite for borrowing, with desire for mortgages, credit cards and loans up signifi cantly on pre-pandemic levelsii. However, consumers are seeking
alternative ways to pay as they address the cost of living crisis, so it’s important that consumer spending is supported with a broad range of payment solutions. We’re still seeing a very mixed picture in
terms of consumer fi nances according to our recent research. More than half (54%) are confi dent their
fi nancial situation will remain stable, yet four in 10 UK consumers are postponing any major spending because they’re worried about their fi nancial future. By using BNPL, consumers have fl exibility and convenience, as well as saving on interest, so it’s clear to see the drivers for the growth which is likely to continue – with forecasts BNPL could increase in size globally by 10 to 15 times by 2025iv.
Driving data-led decisions At TransUnion, we’re taking a phased approach to introducing BNPL data into our products, to make sure it can be implemented fairly for consumers and to give fi nance providers the opportunity to understand how it will aff ect their decision-making processes. As well as the new search types introduced,
BNPL information will soon enhance TransUnion’s TrueVision insights to help bolster lenders’ understanding of customers’ credit behaviours. This will enable them to respond with
agility to changes and continue to conduct comprehensive creditworthiness assessments, make informed credit decisions and stay ahead of the curve.
Footnotes
i Bain & Company, Buy Now, Pay Later in the UK Report, 2021 ii Based on a nationally representative survey carried out amongst 2,000 UK consumers by an independent research agency on behalf of TransUnion in January 2022. Unless otherwise stated all fi gures stated above are based on this research iii TransUnion Is First UK Credit Reference Agency To Accept Buy Now, Pay Later Data, 9 February 2022 iv A Bank of America analyst note to clients from November 2020 suggests estimated global volume of BNPL transactions could grow to between $650 billion and $1 trillion by 2025, or an estimated 10 to 15 times the current market – as reported by Wall Street Journal
In Focus
As the sector braces itself for signifi cant
changes ahead, BNPL providers need to be thinking proactively about their role, putting consumer protection at the forefront and adapting their business models accordingly. We’ve been working with several of the leading BNPL providers that are actively supporting change and starting to educate their customers on the value of credit information and how it can help both protect and empower consumers – something that we call using Information for Good®. CCR
At TransUnion, we are taking a phased approach to introducing BNPL data into our products, to make sure it can be implemented fairly for consumers and to give fi nance providers the opportunity to understand how it will aff ect their decision-making processes
June 2022
www.CCRMagazine.com
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