Companies offering buy now, pay later services like PayPal Holdings Inc. and Klarna Bank AB are selling debt backed by consumer loans, as they find new ways to fund their business in a higher-rate environment.

By offering pools of assets repackaged as securities, these firms are able to access relatively inexpensive funding via private markets, according to several lawyers and bankers speaking on the fringes of the Global ABS conference in Barcelona. That’s helping drive a resurgence in the…