BNPL LOANS TO IMPACT CREDIT SCORES

Summary from the TLDR Marketing newsletter

FICO is introducing new credit scores that include buy-now-pay-later (BNPL) loans, aiming to give lenders better insight into repayment behavior. This change could reduce ecommerce conversions and order values as consumers become more cautious about using BNPL, fearing credit score impacts. A FICO-Affirm study showed that opening multiple BNPL loans in a short time signals higher credit risk, but responsible use could help consumers with thin credit histories build stronger profiles. Merchants may face short-term uncertainty but could benefit from lower BNPL fees and more competitive provider rates.