Technology Record - Issue 31: Winter 2023

CASE STUDY: BLIK Managing credit risk in BNPL Polish payments company Blik has implemented a risk assessment solution with help from software credit solutions provider ITSCREDIT Buy now pay later (BNPL) is a popular payment method for both in-store and online retailers because it allows customers to purchase products and break their payment into future instalments payments, usually without interest rate. Blik, a Polish payments company launched by an alliance of six Polish banks in 2015, has decided to capitalise on the growing interest in BNPL by launching its own product called ‘Blik Pay Later’. To successfully launch the product and tackle the main risk analysis concerns of the BNPL product, Blik partnered with ITSCREDIT, an omnichannel platform provider that focuses on the digitalisation of credit processes. The goal was to develop a sophisticated risk assessment solution that could estimate the credit risk for potential clients, set appropriate credit limits, manage the ongoing risk of the credit portfolio, and fine-tune the scoring models. First, ITSCREDIT’s scoring and decision module was integrated with Blik’s systems. This enabled Blik to carry out risk evaluation through dynamic scoring calculations. ITSCREDIT began the project’s second phase in the second quarter of 2023, aiming to provide additional advanced scoring model features to support Blik users. Once the second phase is completed, Blik will be able to monitor the performance of the scoring models, reduce the time-to-market of scoring models upgrades and changes and subsequently better mitigate credit defaults and losses. “Customers’ payment preferences have shifted in recent years,” says Witold Litaszewski, head of BNPL at Blik. “They want to have the flexibility of reviewing the product first and only then fully engaging their funds. At Blik, we are fully aware of these needs and introducing functionality of BNPL is one of our key strategic decisions.” Blik Pay Later represents a strategic move by Blik, capitalising on the growing popularity of BNPL services. Partnering with ITSCREDIT, Blik developed a robust risk assessment framework to address BNPL’s inherent risks, setting the stage for a more secure and reliable BNPL experience for their customers. This endeavour highlights the adaptability and innovation necessary for the continued success of BNPL in the evolving landscape of modern payments. “We are pleased that ITSCREDIT supports us in this project,” says Litaszewski. “Software delivered by ITSCREDIT is one of the advantages that will help us gain satisfying market shares in the BNPL industry.” ITSCREDIT’s risk assessment solution helps organisations to estimate the credit risk for potential BNPL clients 96