Investigating Whether Buy Now, Pay Later Credit Furnishing Increased Credit-Reporting Complaints Using a Staggered Difference-in-Differences Analysis

Abstract

Buy Now, Pay Later (BNPL) loans were historically unreported to credit bureaus for most consumers. However, over time, BNPL lenders have begun furnishing loan information to credit bureaus, posing an essential question: Has credit furnishing caused a significant increase in consumer credit-reporting complaints? Prior research has examined ethical implications of reporting BNPL data, impacts of BNPL use on credit scores, and predictions that credit furnishing could exacerbate complaints. However, whether furnishing account information has led to a meaningful rise in complaints has not been clearly established. This study addressed that gap by analyzing a Consumer Financial Protection Bureau (CFPB) complaint dataset that was filtered to include approximately 19,000 complaints involving Affirm, Klarna, Sezzle, Zip, and Perpay from January 2022 to June 2026. Additionally, lender-specific initial furnishing dates were compiled from public sources. A random sample of 300 complaints was taken, and each complaint was classified as either a genuine furnishing error or a non-furnishing error using its complaint ID, date, issue, sub-issue, and product information. The credit-reporting classification had a 25.3% false-positive rate. Staggered difference-in-differences (DiD) models estimated an increase of 198.779 complaints for all credit-reporting complaints (p = 0.157; 95% CI: -76.440, 473.997), while the models estimated an increase of 2.071 complaints for furnishing errors (p = 0.285; 95% CI: -1.721, 5.862). Neither estimate was statistically significant. There is insufficient evidence that BNPL lenders furnishing account information to credit bureaus caused a significant increase in credit-reporting complaints. These findings challenge the assumption that reporting BNPL account information alone created a surge in consumer credit-reporting problems.