Zilch highlights the need to talk about credit invisible consumers 

Buy Now Pay Later firm, Zilch has underlined the importance of the five million credit invisible individuals. 

It comes following a report by the Daily Telegraph, which outlined that the UK is on the cusp of having the credit scores of a significant number of individuals affected by engaging with the BNPL payment journey. 

The Telegraph revealed that Zilch will commence with sharing data on customers’ balances and repayments with credit rating agencies, a move that could have an impact on the wider space. 

Nonetheless, Philip Belamant, CEO and Co-Founder of Zilch, underlined the importance of the move – with it supporting a large number of individuals in forming a credit footprint. 

He said: “With the UK population touching a record 70 million, one thing no one is honestly talking about is that over five million adults are deemed ‘credit invisibles’, meaning they are not recognised by any reputable credit reference agencies (CRAs) and have no access to regulated credit lenders. In turn, this drives consumers to illegal lending or disreputable high-cost lenders, for example payday and doorstep lenders.                                                                                                      

“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. 

“As all generations in society look to the future and to fulfil their ambitions of either accessing affordable credit, buying a home, or even taking out a small business loan; a strong credit history is a vital component of achieving this goal. Building credit history should be a lesson we teach our children from a young age. 

“Having successfully created a profitable business model that enables us to flip the burden of credit onto the merchants, Zilch is committed to not only providing affordable, interest-free credit, but also to helping customers advance ways to build their credit profiles for whatever they might need to financially plan for in the future.”

In 2020 Zilch was launched as a result of the FCA Sandbox programme as a regulated direct to consumer business. The firm has experienced significant growth with it now boasting more than five million customers. 

The company detailed that through ‘using the product on average 100 times a year, Zilch has struck a groundbreaking credit reporting agreement that sees it accelerate financial inclusion in the UK’. 

It added: “Zilch already uses in limit assessments and shares data to the UK’s prime Credit Reference Agencies (CRA) about its customers’ borrowing and repayment behaviour whenever they use Zilch’s credit (‘Pay in 4’) product. 

“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.”