Buy now, pay later (BNPL) loans have become a popular method of payment for Gen Zers and millennials because they break purchases into small, easy-to-manage payments over time. Their popularity has stemmed from the relatively few penalties they accrue. Until now, that is; as of the fall of 2025, these programs, which have long lingered in a kind of credit gray area, will now be reportable to people’s credit scores.
Depending on how you use BNPL, improper usage could really hurt your credit score, even tank it. Here’s what you need to know.
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What’s Changing and When
Just as the pumpkin spice lattes are making their seasonal debut, so will BNPL loan users begin to accrue credit score risks for missing payments. Currently, if you’re late on one of your BNPL payments, depending on the payment method (Affirm, Klarna, etc.), you might either be charged a flat late fee, experience restrictions or even blocks on further purchases until it’s paid.
As of fall 2025, if you’re late, it can be reported to credit bureaus, which can impact your FICO credit score. FICO (short for Fair Isaac Corporation) is the data analytics company behind the most widely used credit scoring model in the U.S.
Your three-digit FICO score is a composite of key financial data related to credit and loan history and usage, including:
- Amounts owed: 30%
- New credit lines: 10%
- Length of credit history: 15%
- Credit mix: 10%
- Payment history: 35%
A credit score impacts everything from the likelihood of receiving a loan to the interest rate you qualify for, from auto loans to credit cards and even sometimes rental agreements.
You want to stay in the good to excellent range for best results:
- Good: 670-739
- Very good: 740-799
- Excellent: 800+
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Who This Impacts Most
While people of all ages use BNPL, the largest groups are Gen Z to millennials, ages 25 to 34 — about 40% of the BNPL market, according to a June 2025 Capital One shopping survey. Whether this is because they have less income, are living paycheck to paycheck or just find it convenient is hard to say.
However, older adults are starting to catch on, too. As many as 15.6% of 40- to 60-year-olds used BNPL within the past year, and 34.2% of those over 60, when offered a BNPL option at checkout, used it.
While most people still rely more traditionally on credit cards, BNPL programs are relatively new in comparison and could continue to spread in popularity.
How It Could Hurt Your Score
Like any credit product, responsible use leads to the best outcomes and missing payments and other poor habits can lead to negative outcomes. In the case of BNPL, the outcomes just got a little worse, because now in addition to fees and holds, users may see their credit scores drop. If delinquencies continue, that score could take a big hit.
What Consumers Should Do Now
Like any credit product or loan, it’s important to read the fine print and the repayment terms before you agree to take out a BNPL loan. It’s also not a good idea to take on multiple BNPL loans at the same time, especially as their payments are spread out over time and it can be challenging to keep up with multiple loans. The impact of multiple missed payments can be exponentially bad on your credit score.
BNPL isn’t a magic bullet for staving off payment, but a tool to use only when you know you can truly pay your purchases off.
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This article originally appeared on GOBankingRates.com: ‘Buy Now, Pay Later’ Programs Will Soon Be Able To Tank Your Credit Score
