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Experian appointed to perform creditworthiness checks on buy now, pay later users

Experian will operate the BNPL bureau in Singapore with all accredited BNPL players sharing users’ credit information.

The Singapore FinTech Association (SFA) and the Buy Now, Pay Later (BNPL) Working Group have appointed American-Irish multinational data analytics company Experian as the bureau operator for Singapore’s BNPL Working Group.

Experian will operate the BNPL bureau in Singapore with all accredited BNPL players sharing users’ credit information, such as outstanding BNPL balances, missed payments and delinquencies, to facilitate creditworthiness checks.

The information will be leveraged by accredited BNPL players, in accordance with the BNPL Code of Conduct.

The BNPL Code of Conduct was launched on Oct 20 by the BNPL Working Group, formed by SFA and industry players including Atome, Grab Financial Group and ShopBack.

Designed under the guidance of the Monetary Authority of Singapore (MAS), the BNPL Code sets out guidance for BNPL service providers in Singapore to protect consumers and ensure that BNPL offerings will continue to benefit the ecosystem, says the group.

Under the code, each BNPL provider will allow customers to accumulate no more than $2,000 in outstanding payments at any given time.

Should users wish to increase this limit, BNPL providers will complete an additional credit assessment. This will involve collecting users’ address, nationality and even CPF contribution information or income tax filings.

BNPL providers will also consider users’ creditworthiness as determined through credit information sharing processes before granting any increase in the BNPL limit.

Under the code, BNPL providers say they will suspend a consumer’s access and use of its BNPL services should they fail to meet any payment obligations.

According to the code, new customers on BNPL platforms will face the $2,000 limit. Existing customers who were onboarded prior to Nov 1 may continue with their prior BNPL limit until providers implement the measures above, or Nov 1, 2023, whichever earlier.

Maria Liu, managing director, Experian Greater China and Southeast Asia, says in a Nov 24 press release: “We are very excited to be appointed by the BNPL Working Group to provide the technological infrastructure for the BNPL Working Group and showcase Experian’s technology and expertise in the field. We’ve been operating BNPL bureaus in the United States and the United Kingdom, and this would be the first step in bringing our global expertise into the region.”

Shadab Taiyabi, president of SFA, says: “The launch of the BNPL Code, which sets out clear guidelines and standards for consumer protection, represents a significant step forward within the industry to ensure that BNPL offerings continue to benefit the ecosystem. To succeed in our mandate, we recognise the importance of working with different facets of the industry, which is why we are delighted to partner with Experian to facilitate creditworthiness checks for consumers and ensure that consumers’ interests continue to be prioritised.”

In addition to Atome, Grab and ShopBack, the other BNPL Working Group participants are: Ablr, Latitude Pay, Pace, Split and SeaMoney.

BNPL providers who agree to follow the guidelines will be required to undergo an audit and accreditation process which will allow them to display an accredited “trustmark” showing customers that they are compliant with the BNPL Code.

Accredited BNPL providers will be required to undergo a re-accreditation process every three years.

The BNPL Working Group says the next phase of rollout includes setting up the credit information sharing bureau, completing the accreditation process and awarding the trustmark to accredited BNPL providers. It expects to complete these in late-2023.

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