Affirm Holdings, Inc. (NASDAQ: AFRM) saw its stock surge 5.68% in pre-market trading on Wednesday, building on the previous day's 5.09% gain. The continued upward momentum comes after the company's announcement of a significant expansion in its credit reporting practices.

On Tuesday, Affirm revealed plans to report all new pay-over-time loans to TransUnion (NYSE: TRU) starting May 1, 2025. This move encompasses all of Affirm's pay-over-time products, including the popular Pay in 4 option and longer-term monthly installments. While the new reporting will not immediately impact credit scores, it sets the stage for potential inclusion in future credit scoring models.

Investors are reacting positively to this strategic decision, viewing it as a sign of Affirm's commitment to transparency and responsible lending practices. The expansion of credit reporting could potentially broaden Affirm's customer base and strengthen its position in the competitive fintech market. Additionally, TransUnion's research suggests that this move could increase consumer adoption of buy now, pay later services, as 53% of non-users indicated they would be more likely to use such services if it had the potential to positively impact their credit scores.