Fintech startup Qlarifi has raised £1.4 million in a pre-seed funding round to enhance its consumer credit data platform. The investment, backed by HoneyComb Asset Management, Carthona Capital, and several angel investors including former Australian rugby captain John Eales, will be directed towards strengthening data infrastructure and expanding customer reach. As the Buy Now Pay Later (BNPL) market continues to expand, lenders require more accurate and real-time data to assess financial risk. Qlarifi aims to address this gap by offering a continuously updated credit database.
Previous reports on BNPL services have highlighted concerns over the lack of transparency in consumer credit assessments. Traditional credit reporting often excludes BNPL transactions, leaving lenders with incomplete borrower profiles. Qlarifi’s platform seeks to resolve this issue by providing comprehensive insights into consumer credit usage, particularly within the BNPL sector. While past solutions have focused on periodic updates, Qlarifi differentiates itself by refreshing data every 3.5 seconds, offering lenders a more precise risk evaluation method.
How Does Qlarifi Improve Credit Assessments?
Qlarifi offers lenders a real-time credit database that emphasizes BNPL transactions, which are frequently omitted from conventional credit reports. By delivering continuous updates, the platform helps financial institutions identify borrowers in financial distress while improving access to credit for responsible consumers. This capability enhances risk management and allows lenders to make more informed underwriting decisions.
What Role Does Fraud Prevention Play in Qlarifi’s Strategy?
Alongside credit assessments, Qlarifi works to detect fraudulent activities by identifying irregular borrowing patterns at an early stage. By monitoring real-time data, the platform enables financial institutions to respond swiftly to potential fraud risks. The company also adheres to regulatory frameworks such as GDPR and CCPA, ensuring data privacy and security compliance.
Qlarifi’s infrastructure is designed for scalability, reducing operational risks and credit scoring costs for lenders. As BNPL services gain popularity, with approximately 415,000 daily applications in the UK, the need for precise and timely credit data continues to grow. The company aims to support financial institutions in adapting to this evolving market through its advanced data solutions.
“Our reason for building Qlarifi was to create transparency and a fit-for-purpose solution to a problem that’s been frustrating us for too long. We’re proud that the industry has responded so positively. They’ve been crying out for the real-time information Qlarifi provides,”
said Alex Naughton, CEO and Co-Founder of Qlarifi.
“This funding round reflects the confidence our investors have in our mission and enables us to take the next leap in our growth journey,”
said Dean Dorrell, Partner at Carthona Capital, adding that BNPL’s rapid expansion makes Qlarifi’s technology particularly relevant.
“Qlarifi is tackling transparency in a booming industry that is demanding their solution. The response Alex, Loic and the team have already received will be important for both businesses and consumers in the ecosystem,”
added John Eales, highlighting the significance of real-time credit assessments in the BNPL market.
The expansion of BNPL services has raised concerns about financial stability and borrower overextension, prompting calls for improved credit reporting. While traditional credit bureaus have been slow to integrate BNPL data, fintech solutions like Qlarifi are addressing these gaps. By delivering real-time insights, the company may contribute to a more transparent and efficient lending environment. However, the effectiveness of such platforms will depend on their adoption by financial institutions and regulatory developments within the sector. As consumer demand for BNPL continues to rise, lenders will likely seek more comprehensive tools to manage risk and compliance effectively.
