FICO’s New Rule Could Drop Your Score—Here’s How to Avoid BNPL Pitfalls

You want that new computer, but your bank account says, “Try again next month.” So, you click “Pay in 4,” and boom, problem solved.

Buy Now, Pay Later (BNPL) apps have made it convenient to split payments into smaller chunks without racking up credit card bills. But starting this year, the way you use BNPL could impact your credit score.

FICO, the company behind the most common credit scores, just said it will consider BNPL accounts when calculating your score. If you’re late on a BNPL payment, your credit could take a hit. On the flip side, paying on time could boost your score.

So, What Should You Do?

If you want to keep your credit score healthy while using BNPL, here are a few simple tips.

Always pay on time. Even one missed payment can ding your score.
Hold off on that new computer. Don’t rely on BNPL and only purchase an item when you can fully cover its cost.
Regularly monitor your credit report. It never hurts to ensure everything’s being reported accurately.
Don’t open multiple BNPL accounts at once. This can temporarily lower your score.

Bonus Tips to Keep Your Credit Score High

Even if your credit card limit is $5,000, that doesn’t mean you should spend $5,000 monthly. Try to keep your balance below 30% of your limit. For example, if your limit is $5,000, try not to go past $1,500. This keeps your credit utilization ratio low, which helps boost your credit score. Also, avoid closing old accounts like your student card too quickly; the longer your credit history, the better.
A mix of credit types—like a credit card, car loan or student loan—shows lenders you can handle different kinds of debt responsibly. The most important thing is to pay on time, as even one late payment can lower your score.
Set up autopay or reminders so you don’t miss a payment accidentally. This is especially helpful with BNPL plans, which may not remind you about payment due dates.
Check your credit report yearly to catch any mistakes before they become a bigger issue. You can request a free copy of your credit report every year from each of the three main credit bureaus (Equifax, Experian and TransUnion) using AnnualCreditReport.com.

What This Means For You

Buy Now, Pay Later isn’t just a convenient way to split up purchases anymore. It’s starting to count toward your credit, just like a credit card or loan. That means if you’re using it wisely and staying on top of your payments, it could technically help your score. But if you miss a payment, you might hurt it.

So while BNPL can be helpful, it’s more important than ever to keep track of what you owe and pay it off on time.

MATIASGUARRO