Op-Ed: Buy-Now-Pay-Later a ‘Generational’ Financial Inclusion Opportunity

When 100 million Americans use a product, and nearly 90 percent are ‘satisfied’ or ‘highly satisfied with their experience, the product is here to stay. 

That’s according to the latest op-ed from Liz Pagel, Senior Vice President and consumer lending leader at TransUnion. Writing for the Forbes Finance Council, Liz utilizes information from TransUnion’s Q2 Consumer Pulse survey to help educate financial leaders on what they need to know about Buy-Now-Pay-Later loans and the significant opportunity they represent for financial inclusion. 

BNPL loans are a payment option (typically offered at checkout) that let shoppers pay for their purchase in installments. Unlike traditional loans or credit cards, these loans do not appear on the credit report – at least, not yet. 

Adding that information to the credit report could represent a tremendous opportunity to help consumers build credit – ‘thin’ or no-file consumers in particular. Here’s more from the op-ed on why:

“By introducing BNPL into models and decisions slowly, we can also ensure the data is treated fairly.  Over time, consumers will be able to build credit through those frequent on-time payments – if, of course, the data is furnished to the credit bureaus.

Importantly, one in three users is between the ages of 18 and 30. That means they are just getting started in their financial journey. That’s exactly why this represents a generational opportunity across the credit ecosystem."

The good news is, most BNPL companies are already on track to furnish their data to credit bureaus like TransUnion – some starting this year.  They understand the value of reporting and are investing to make it happen.

Read the full op-ed on Forbes and stay tuned for more from Liz about the future of consumer lending and consumer habits.