Apple (NASDAQ:AAPL) released a buy now pay later (BNPL) product a year ago. Expectations are for a more extended credit option to appear soon as Apple continues its ongoing expansion into financial services.
Today, Experian has shared that Apple BNPL users will now have their payments and credit history reported directly to Experian. The credit reporting agency states that the underreporting of this information has created blind spots for lenders.
“Traditional lenders are unable to gain a complete view of a consumer’s financial obligations, which limits their ability to accurately assess risk. At the same time, BNPL providers don’t have a view of how or if a consumer has managed BNPL payments with other providers.”
Experian said that Apple Pay Later loans borrowed today (February 28, 2024) and onward will appear on a consumer’s Experian credit report with a BNPL designation starting March 1. While this will show up on consumer credit scores, the data will not be factored into credit scores, at least for the time being. At some point in the future these loans will show up on credit scores.
While it was nice while it lasted, the change makes a lot of sense. More and more users are opting for BNPL options as opposed to expensive credit cards – which do show up on your credit scores.
At the same time, if Apple is going to offer a term loan or extended BNPL credit product, they will have to provide the data to credit reports to operate as a prudent lender.