Zilch could now impact your credit score, as lending data is shared with bureaus

By Oliver Smith on Tuesday 17 January 2023

Alternative Lending

Some 3 million customers could soon see their credit scores impacted, both positively and negatively.

Zilch could now impact your credit score, as lending data is shared with bureaus
Image source: Philip Belamant/Zilch.

Direct-to-consumer buy now, pay later lender Zilch has started reporting its 3 million customers’ borrowing data to UK credit bureaus, in a way that could impact credit scores.

Until now Zilch has had partnerships with individual credit bureaus like Experian, but has only used this data as part of its affordability assessments to perform “soft” credit checks on borrowers and to add data to credit files in a way that didn't impact credit scores.

In a statement yesterday, the lender explained that it will now be integrating with all the credit bureaus in a way that could influence credit scores.

“From this month, Zilch is integrating with all reputable CRAs to start influencing customers’ credit scores, giving them the opportunity to improve and build their credit history if they keep up to date with Zilch and all their credit payments,” the company said.

First reported by The Sunday Telegraph, the move is likely a response to long-awaited industry regulation which is expected to require all BNPL lenders to report data to the credit bureaus.

Klarna, the UK’s largest pay later lender, began reporting its 16 million customers’ borrowing data to the bureaus in June 2022.

Zilch CEO and co-founder Philip Belamant positioned the decision to share data with the bureaus as a positive move for some 5 million UK adults who are “credit invisible” and unable to access regulated lenders that would help improve their creditworthiness.

“In turn, this drives consumers to illegal lending or disreputable high-cost lenders, for example payday and doorstep lenders,” said Belamant.

“The global cost-of-living crisis is having a debilitating impact on the most vulnerable people in our society and, more than ever, people in Britain are finding themselves in need of access to affordable credit.”

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