Buy now pay later startup Zilch has secured a consumer credit authorisation with the Financial Conduct Authority (FCA), which could be a first for the London-based venture.
“Zilch was built with customer affordability at the forefront of everything we do and we have been working towards this point since our conception,” said Philip Belamant, founder and CEO of Zilch. “Having secured our consumer credit authorisation with the FCA is another step towards improving consumer financial wellness and removing credit related anxiety for our customers.”
Zilch leverages open banking data via its partnership with CreditKudos as well as soft credit checks to ensure each customer’s creditworthiness and affordability is assessed accurately every time they shop. The idea is that this will prevent debt.
The news comes after Zilch entered the FCA’s regulatory sandbox in April 2019. “We have been working very closely with the FCA over the past 12 months to make this a reality – I don’t think I’ve ever come across a regulator with such a forward thinking approach to innovative business models,” said Belamant.
“The Sandbox programme allowed us to seek advice from the FCA, get their oversight and guidance on our initial testing and ultimately ensure we were building a model that is not only profitable for our business but, importantly, one that works for our customers too.”
Zilch exited stealth in September 2020 on the back of a $10m investment raise with the aim of taking on bigger players in the instalments industry such as companies like Klarna and Afterpay.
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