Could ‘buy now, pay later’ actually help your credit score?

‘Buy now, pay later’ loans will soon appear on your credit report. The three major credit bureaus — Equifax, Experian and Transunion — have each announced plans to include these items in the reports they compile about consumers.

A point-of-sale payment method that’s booming in popularity, BNPL loans let customers pay purchases off with a limited series of payments.

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Equifax says including BNPL loans on credit reports gives more people the potential to boost their credit score, especially customers who have poor credit or limited credit history.

What is Buy Now Pay Later?

BNPL is a type of loan that is often available at checkout when customers make an online purchase.

How Buy Now Pay Later can affect your credit

The BNPL data included on your credit report may include loan status, payment activity, the number of BNPL loans you have and the amounts owed. But the way that the data is included can differ between credit bureaus.

Should you use BNPL to make purchases?

BNPL purchases are attractive because they don’t require hard credit inquiries and approval happens very quickly. They allow customers to pay off purchases over time like a credit card but often don’t charge interest.


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