Affirm expands credit reporting to Experian

SAN FRANCISCO - Affirm Holdings, Inc. (NASDAQ: AFRM), a $14 billion market cap fintech company showing impressive revenue growth of 46% year-over-year, has announced it will expand its credit reporting to include all of its pay-over-time products with Experian, starting April 1, 2025. According to InvestingPro analysis, while the company maintains strong liquidity with current assets significantly exceeding short-term obligations, it continues to focus on growth over immediate profitability. This initiative aims to foster greater transparency in lending and assist consumers in building their credit histories. With a robust current ratio of 12.29, Affirm demonstrates strong financial flexibility to support this expansion of services. For deeper insights into Affirm’s financial health and growth prospects, InvestingPro subscribers have access to over 30 additional exclusive financial metrics and analysis.

In a move described as industry-leading, Affirm will report information on all transactions, including its Pay in 4 product, to Experian. This expansion is expected to enable both consumers and lenders to make better-informed financial decisions. Affirm’s President, Libor Michalek, emphasized the importance of evolving from offering flexible payments to aiding consumers in managing their finances and establishing credit.

Scott Brown, Group President of Experian North America, praised Affirm’s decision, highlighting the partnership’s role in promoting financial health and informed lending. The reporting of pay-over-time loans to Experian will not immediately impact traditional credit scores, but it could influence future credit scoring models.

The new policy allows consumers to see all loan information from Affirm on their Experian credit file for loans issued from April 1, 2025, onward. As more providers follow suit, lenders using Experian credit reports will gain access to a consumer’s comprehensive pay-over-time history. This change is part of a broader effort to support responsible credit extension by providing lenders with a more complete picture of a borrower’s financial behavior.

Affirm also plans to work with other credit reporting agencies to furnish data on all loan products. Consumers can access their updated Experian credit report daily through a free membership on Experian’s website or mobile app.

This news is based on a press release statement from Affirm Holdings, Inc.

In other recent news, Affirm Holdings Inc. disclosed that Walmart’s fintech arm, OnePay, has decided to partner with Klarna Group for installment loan financing services, introducing a direct competitor into Affirm’s relationship with Walmart. Despite this development, Affirm continues to offer its payment options to Walmart shoppers through an integrated program and its direct-to-consumer products. Mizuho Securities analysts defended Affirm, emphasizing that the partnership between Klarna and OnePay does not affect Affirm’s ongoing business with Walmart. UBS maintained a Neutral rating on Affirm, with a price target of $62, noting Affirm’s role as a pay-over-time option for Walmart in the U.S.

The financial relationship between Affirm and Walmart was quantified, with transactions through Affirm’s integrated program accounting for about 5% of Affirm’s Gross Merchandise Volume and around 2% of its Adjusted Operating Income for the six months ending December 31, 2024. Meanwhile, Affirm has extended its exclusive relationship with Shopify until June 2028, and despite not being exclusive with Amazon for two years, it has observed strong performance in that partnership. In other developments, StockX has teamed up with Affirm to offer flexible payment options to U.S. customers, enhancing access to brands like adidas and Gucci. This partnership aligns with the growing demand for flexible payment solutions in the apparel and accessories sectors, as noted by Affirm’s SVP of Revenue, Pat Suh.

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