How Buy Now, Pay Later can affect your credit score: What consumers need to know
Quick insights
- A Buy Now, Pay Later (BNPL) plan is a type of installment loan where you buy something with little to no down payment and pay it back over fewer payments.
- BNPL services are rapidly growing in popularity due to greater financial flexibility for consumers that might not be able to make an immediate purchase.
- The main credit bureaus, Experian™, Equifax® and TransUnion® include BNPL activity on their credit reports when reported.
According to the Consumer Financial Protection Bureau (CFPB), a BNPL service is “a type of installment loan that typically allows you to purchase something immediately with little or no initial payment and pay off the balance over four or fewer payments.”
These types of services may exist for some online, in-store or mobile purchases. BNPL plans have seen a rapid growth in popularity, so you might be interested in what BNPL services are and how to use them. But how do BNPL plans impact credit scores? Let’s find out.
What is a credit score?
Credit scores are three-digit numbers that are based on the information in your credit reports. According to the CFPB, credit scores help predict your credit behavior, such as how likely you are to pay back a loan on time.
Lenders use consumers’ credit scores, among other factors, to decide whether to loan borrowers money and according to what terms and conditions. This is why it can be important to have a high credit score.
Do BNPL plans affect your credit score?
The answer depends on whether your lender reports BNPL information, including payment, to the credit bureaus. For something to affect your credit score, it has to be in your credit report. Typically, BNPL providers didn’t use to, but this is starting to change (more on that below). If they do report it, then your payment history could be reflected in your credit score. For example, if you make your payments on time, you could have a positive impact to your score. On the other hand, missed payments could have a negative impact on your score.
Do buy now pay later services report to credit bureaus?
If you don’t pay back your BNPL loan and your accounts goes into collections, a debt collector could report it to a credit reporting company, which could potentially hurt your credit. But besides that, BNPL lenders haven’t typically reported BNPL payment history to the major credit reporting companies, according to the CFPB.
That is starting to change, though. While not all BNPL services report your activity, some may have begun reporting payment plans and repayment activity in 2025 to the credit bureaus.
Policies can vary by BNPL provider and can also depend on the installment loan type, since some BNPL installment loans are reported, while others are not.
How hard credit checks for BNPL differ from other lending products
Usually, a hard credit check—like those used when applying for a new credit card or loan—has a temporary effect on credit scores. With BNPL plans, though, many providers use soft credit checks, which do not impact credit scores.
However, some BNPL providers might use hard credit checks for larger purchases or longer-term plans. So be aware of whether you might get a hard credit check reported on your credit report after applying for a BNPL plan—if you do multiple hard credit checks in a short period of time, that may have a negative effect on your credit.
How is credit affected by a missed payment?
Missing a payment on a BNPL plan can have several immediate and long-term consequences, including:
- Late fees or account suspension or closure: Most BNPL providers charge late fees if you fail to make a payment on time, and repeated missed payments may result in your account being suspended or even closed, preventing you from making future purchases with that service. The severity of these penalties varies by provider, but even a single missed payment can disrupt your ability to use BNPL for future purchases.
- Credit score impacts: If the BNPL provider reports to credit bureaus, a missed payment can be recorded on your credit report. This negative mark may impact your credit score, as payment history is a major factor in credit scoring models. The negative mark can remain on your credit report for up to seven years.
To help prevent these issues, it can be helpful to enable automatic payments if available and monitor your account regularly to ensure you don’t miss a due date. Taking these steps can help you maintain a positive payment history and help protect your credit score.
Using BNPL to build credit
Using BNPL services responsibly can offer benefits for individuals looking to build or rebuild their credit, especially those with limited credit history.
Here are some of the ways using BNPL could help you build or improve your credit:
- If a BNPL provider reports payment activity to credit bureaus, making on-time payments can help establish a positive payment history, which is a key factor in improving credit scores.
- For borrowers who may not qualify for traditional credit cards or loans, BNPL plans can serve as an alternative credit-building tool, allowing consumers to demonstrate responsible borrowing and repayment behavior.
Remember that not all BNPL providers report to credit bureaus.
In conclusion
Using BNPL services may have an impact on your credit score, but this mostly depends on the provider’s reporting policies and how you manage your payments.
Some BNPL companies report your payment activity to credit bureaus, which means that responsible use—such as making payments on time—may help improve your credit. On the other hand, missed payments may harm your credit score and remain on your credit report for years.
Not all BNPL providers report to credit bureaus or use the same type of credit check, so it’s important to understand the specific terms and practices of any service you’re considering. To use BNPL responsibly, read the fine print about credit checks and reporting, set up reminders or automatic payments to avoid missing due dates and monitor your credit regularly to track any changes. Chase Credit Journey® is a free online tool that can help you keep track of your credit score and review your credit report provided by Experian.
If building credit is your goal, research which BNPL providers offer reporting to credit bureaus. For additional information, consider exploring reputable resources like the CFPB, your bank’s educational materials or nonprofit credit counseling organizations to learn more about credit scores and responsible borrowing.
