Buy Now Pay Later and Your Credit Score: What the 2025 Changes Mean for Your Financial Future

Buy Now, Pay Later (BNPL) services have transformed how consumers shop, offering flexible installment plans for everything from electronics to everyday essentials. But starting this fall, the way these short-term loans affect your financial profile is about to change—dramatically.

BNPL Credit Score Changes Coming in Fall 2025

FICO®, short for the Fair Isaac Corporation, is a data analytics company best known for its credit scoring system, which helps lenders assess a consumer’s creditworthiness. A FICO® Score is a three-digit number, typically ranging from 300 to 850, that summarizes a person’s credit risk based on their credit history. It is widely used by banks, credit card issuers, and other financial institutions to make lending decisions.

Beginning in Fall 2025, FICO will introduce two new credit scoring models—FICO® Score 10 BNPL and FICO® Score 10 T BNPL—that incorporate Buy Now, Pay Later (BNPL) loan data into credit scores for the first time. This marks a significant evolution in credit evaluation, reflecting the growing popularity of BNPL services, especially among Gen Z, Millennials, and households managing tighter budgets. By factoring in BNPL activity, these new models aim to provide lenders with a more comprehensive view of a consumer’s financial behavior and risk profile.

Why BNPL Credit Reporting Matters

Until now, BNPL loans were largely invisible to credit bureaus. That meant consumers could take on multiple installment plans without those debts showing up in their credit reports. But with platforms like Affirm and Klarna now reporting to major bureaus like Experian and TransUnion, that 'phantom debt' is no longer hidden.

BNPL Loans and FICO Score: What Consumers Need to Know

• Positive Impact: If you consistently repay BNPL loans on time, your score could improve—especially if you have a limited credit history.
• Negative Impact: Missed or late payments will now be reported and can lower your score, just like traditional credit card or loan defaults.
• Score Movement: FICO’s simulations show that most users will see a score change of around ±10 points, similar to opening a new account.

BNPL Usage Trends and Affected Demographics

BNPL adoption is highest among: Low- and middle-income consumers, Women, Black and Hispanic communities, Millennials and Gen Z. For many, BNPL is a lifeline—offering access to goods without the burden of credit card interest. But with these new rules, responsible use becomes more critical than ever.

How to Prepare for BNPL Credit Reporting

1. Audit Your BNPL Activity: Identify any open BNPL loans and catch up on missed payments.
2. Set Up Autopay or Reminders: Avoid accidental late payments that could hurt your score.
3. Limit Simultaneous Loans: Just like credit cards, opening too many BNPL plans can complicate your credit profile.
4. Monitor Your Credit Report: Check for accuracy and dispute any errors, especially as BNPL data begins to appear.

Future of BNPL and Credit Scoring

While adoption of these new FICO models will be gradual, they’re expected to become standard in the coming years. For consumers, this means BNPL loans will carry the same weight as traditional credit products in shaping your financial future.

Bottom Line: Smart BNPL Use is Key

BNPL can still be a smart financial tool—if used wisely. As these changes take effect, treating BNPL like any other form of credit is essential. Pay on time, borrow responsibly, and stay informed to protect and grow your credit score.

Frequently Asked Questions (FAQ)

Q: Does BNPL affect my credit score in 2025?
A: Yes, starting Fall 2025, BNPL loans will be included in certain FICO credit scoring models.

Q: Which BNPL providers report to credit bureaus?
A: Affirm and Klarna have begun reporting to Experian and TransUnion.

Q: How can I improve my credit score with BNPL?
A: Make timely payments and avoid taking on multiple BNPL loans simultaneously.

To learn more about savvy ways to save, building credit, or dealing with debt, visit Bank of Hawaii's SmartMoney learning center.

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The content in this article is for informational purposes only, and should not be construed as tax, legal or accounting advice by Bank of Hawaii and its affiliates. You should consult your own tax, legal and accounting advisors.

References

1. OPB: https://www.opb.org/article/2025/07/05/fico-scores-will-include-add-buy-now-pay-later-purchases-what-it-means/
2. USA Today: https://www.usatoday.com/story/money/2025/06/27/buy-now-pay-later-loans-affect-fico-scores/84369334007/
3. USA Today: https://www.usatoday.com/story/money/personalfinance/2025/07/03/buy-now-pay-later-fico-credit-score/84330738007/
4. Certuity: https://certuity.com/insights/new-fico-models/