Afterpay New Zealand to Implement Mandated Credit Checks and Reporting
Afterpay New Zealand has announced that starting from 23 July, both new and existing customers will be required to consent to mandated credit checks. This will be followed by credit reporting from 15 August. These measures are part of the new responsible lending framework for the Buy Now Pay Later (BNPL) sector, effective from 2 September 2024. The framework aims to enhance consumer protections, such as preventing further spending if a payment is missed.
Michael Saadat, Head of International Policy at Afterpay, stated: “Afterpay is committed to complying with the new regulations, which we welcomed in August 2023. We aim to be transparent with our customers about these changes as they continue using our service responsibly.”
Existing customers will undergo a soft credit check, which does not affect their credit score, to assess suitability for spend limit increases. New customers will face a hard credit check at onboarding, impacting their credit file, to determine a customized spending limit. Starting 15 August, credit reporting will occur monthly, sharing account details with credit bureaus.
In 2023, the company and other BNPL providers partnered with Centrix to launch PayWatch, an initiative to help protect consumers by sharing overdue account data daily. This initiative will continue alongside the new regulatory framework to provide a comprehensive view of BNPL engagement.
For more information about these updates, the company customers can visit the provided link.
