Buy Now, Score Later? FICO to Factor BNPL Loans into Credit Scores

Buy Now, Pay Later loans have exploded in popularity over the past few years, offering fast, flexible ways to split purchases into smaller payments without traditional interest charges. If you’ve ever used services like Klarna, Affirm, Afterpay, or Zip, you’re part of a booming movement that’s reshaping the way people shop. But until now, there’s been one major blind spot: BNPL loans didn’t affect your credit score, good or bad.

That’s about to change.

FICO, the company behind the most widely used credit scoring system in the U.S., has announced that its upcoming credit models will include Buy Now, Pay Later data. Specifically, later this year they’ll roll out FICO Score 10 BNPL and FICO Score 10 T BNPL, the first major scoring models to factor in your BNPL usage.

So what does that mean for your credit, and should you be worried?

BNPL Could Build Your Credit, Or Break It

At first glance, this might sound like good news. For many BNPL users (especially younger adults or those with thin credit files) this could be a way to build credit history without taking on traditional credit cards or loans. If you make payments on time and use these services responsibly, you could see your credit score improve.

But that’s only one side of the story.

Because BNPL loans are so easy to access, and often don’t require a credit check at all, they’ve created a behavioral trap: overspending. A Bankrate survey earlier this year found that nearly half of BNPL users have run into problems, with overspending being the most common issue. It’s easy to see why. These services make it frictionless to stack up multiple installment loans, all while convincing you it’s “just four easy payments.”

The result? What economists call “phantom debt,” financial obligations that don’t show up on your credit report but still quietly accumulate behind the scenes. And now, those phantom debts could finally come into focus.

Why This Matters (And Why It’s Complicated)

Until now, most BNPL lenders didn’t report your activity to credit bureaus. That made it hard for banks, landlords, or even employers to see the full picture of your financial behavior. But it also meant that a missed payment wouldn’t hurt your credit, and a perfect payment wouldn’t help it.

That era is ending. As major BNPL providers like Affirm begin to report data to credit bureaus, and as FICO adjusts its scoring models to process it, your BNPL history could become a real credit risk, or a legitimate credit-building tool.

But here’s the catch: not all credit scoring systems will adopt this change right away. FICO has released multiple versions of its scoring model, and the one being used depends on the lender and the type of credit you’re applying for. Many mortgage lenders still use FICO Score 2, 4, or 5, older versions that won’t see your BNPL history at all. Others may take years to upgrade their systems. So while FICO’s announcement is a big step forward, it doesn’t mean an overnight transformation.

Think of it like a new iPhone: it’s out there, but not everyone is using it yet.

What Makes BNPL Tricky for Credit Scores

Here’s where things get messy. BNPL loans don’t behave like traditional credit. With every new BNPL transaction, you’re technically opening a new account, and then closing it once the loan is paid off. That kind of behavior, if treated like a credit card, would normally tank your credit score.

That’s why FICO isn’t simply plugging BNPL into their old formula. Instead, they developed a “novel scoring method” that aggregates these loans into a single category. It recognizes that someone making 10 $50 purchases over the course of a month isn’t necessarily the same as someone opening 10 separate lines of credit.

Still, the stakes are real: If you’re maxing out short-term payment plans and missing deadlines, your score could take a hit, even if you’ve never missed a credit card payment in your life.

A Word of Caution for Everyday BNPL Users

BNPL was designed to make shopping more flexible. But in the past year, there’s been a spike in people using BNPL for essentials (groceries, gas, basic bills.) That’s a red flag. If you’re using installment loans just to get through the week, it’s not a budgeting strategy, it’s a financial warning sign.

And now that your BNPL history may start appearing on your credit report, the consequences of overuse are no longer invisible.

A Smarter Way to Handle Financial Gaps

If you’re relying on BNPL to get by, it may be time to explore alternatives that don’t spiral into hidden debt. That’s where BuckUp comes in.

Instead of stacking risky installment loans, BuckUp lets you get quick cash using the value of your phone or laptop, without selling it. There’s no credit check, no hidden interest, and most people repay within 30 days. It’s a clean, safe way to cover an unexpected bill, avoid a missed payment, or get through a tough spot without making your future harder.

And best of all? BuckUp never penalizes you for getting back on your feet.

BNPL Is No Longer Off the Radar

Buy Now, Pay Later loans are about to become part of your official financial identity. That means every “four easy payments” could help or hurt your credit, depending on how you manage them.

So if you’re going to use BNPL, use it wisely. And if you’re feeling stretched thin, remember: you have other options.

Your credit score is finally watching. Let’s make sure it likes what it sees.