Key takeaways

• FICO will release a new credit-score model that factors in BNPL loans in fall 2025.
• While 40% of BNPL users say the loans not impacting their credit is a top benefit, 45% say they won’t change the habit even if their score changes.
• Empower Personal Dashboard^TM data shows a dramatic rise in BNPL usage, with monthly spend increasing 21% between June 2024 and June 2025.

Wondering if BNPL affects your credit score? A new credit score model going into effect this fall will add BNPL loans to credit reports.

Turns out ‘later’ isn’t that far off for your credit score. FICO, the company that creates credit scores, will start including Buy Now, Pay Later (BNPL) data in its scoring model in fall 2025. Banks and lenders will be able to see one score that considers users’ BNPL loans — and one that does not — and decide which to use as they consider borrowers’ creditworthiness.

For the 52% of Americans already using BNPL for everything from grocery shopping to funding their next vacation, the move could introduce new credit reporting implications that affect how lenders evaluate their financial health.¹

Read more: The rise of Buy Now, Pay Later

How does BNPL actually work?

Typically, BNPL loans split payments into four interest-free installments over six weeks. Major retailers — including Amazon, Walmart, and Sephora — have partnered with BNPL providers such as Afterpay, Klarna, and Affirm to offer the payment option. These arrangements allow customers to make an initial payment at the time of purchase and receive their goods immediately.

Empower Personal Dashboard^TM data reveals BNPL usage has grown significantly in recent years: Monthly BNPL spending increased almost 21% from $201.60 in June 2024 to $243.90 in June 2025.

To date, BNPL loans have had no impact on consumers’ credit scores, offering a “less scary” alternative to traditional credit cards, according to two in five Americans.²

Will what seemed interest-free now cost points?

Soon, FICO’s new BNPL-inclusive model will give lenders increased visibility into consumers’ repayment behavior.

The new scores were trained on a sample of more than 500,000 BNPL users in a joint study with Affirm. The model groups together multiple BNPL loans when evaluating creditworthiness. According to FICO, consumers with five or more Affirm loans typically saw their scores increase or remain stable under the new model during early testing.³

Industry experts predict the shift won’t dramatically alter existing credit profiles but could result in a more accurate picture of a consumer’s debts and keep consumers from over-extending themselves.⁴

Still, many consumers remain unfazed. About 40% of BNPL users say that not affecting their credit score is one of the top benefits of using the service, according to a recent survey of over 1,000 Americans. Despite this, 45% of users said they wouldn’t change their BNPL usage even if it began to impact their credit score.⁵

A calculated risk

In the U.S., where credit scores influence access to everything from housing to cars, incorporating BNPL data into credit scores is high stakes. For consumers who have treated BNPL as a no-strings alternative to credit cards, the shift could spotlight the need for accessible financial education to teach borrowers how to use credit responsibly.⁶

Data shows significant differences in financial behaviors between BNPL-users and non-users, including a tendency among BNPL users to spend more and to perceive BNPL purchases as feeling “free.”^7,8 An analysis from the Consumer Finance Protection Bureau found around 63% of BNPL users took out multiple loans at the same time in the last year and 33% of users borrowed from multiple lenders.

Read more: Gen Z's passion for plastic: Strategies for dealing with credit card debt

But BNPL could work in consumers’ favor

FICO said the new model will responsibly expand access to credit for younger consumers and those who may not have good or lengthy credit histories.⁹ Consumers who repay their BNPL loans on time could see their credit scores improve, making it easier to get a mortgage, car loan, or apartment.

Read more: How to build credit

FAQs about BNPL and credit scores

When will Buy Now, Pay Later be added to my credit score?

FICO will launch its new credit score model with Buy Now, Pay Later (BNPL) data starting in the fall of 2025.

How does Buy Now, Pay Later affect credit scores?

As of July 2025, Buy Now, Pay Later doesn’t affect credit scores, but that will change this fall when FICO rolls out a new credit score model that factors in BNPL data. At that point, missing payments on a BNPL loan may make it more likely that your credit score will be penalized.¹⁰

How does Buy Now, Pay Later make money?

The Buy Now Pay Later business model earns revenue primarily through merchant fees, typically ranging from 4% to 9.5% of the purchase amount.¹¹ Retailers pay these fees in exchange for increased sales and higher average order values. While many BNPL plans are interest-free for consumers, providers may also generate income from late payment fees, interest on longer-term financing, and interchange fees on branded payment cards.