Buy now, pay later Might as well buy now, worry later.
For the first time this year, use of the popular shopping feature will be reflected in your credit score.
In its 2025 Holiday Shopping Trends report, Adobe expects Americans to spend nearly $12 billion on Black Friday purchases when all was said and done, surpassing last year's total by $1 billion. The company stated Cyber Monday will likely see similarly strong sales.
While some shoppers buy things outright, many others rely on BNPL plans that allow them to spread out payments over time. Adobe estimates that between November 1 and December 31, US consumers will spend more than $20 billion online on BNPL plans, up 11% from 2024.
“This is approximately $2 billion more than the 2024 holiday season, when BNPL spent $18.2 billion online,” the company said. “BNPL usage on Cyber Monday is expected to reach a new milestone of over $1 billion ($1.04 billion, up 5% YoY).”
Under BNPL plans, buyers pay a portion upfront and then continue to pay the remaining amount on specified dates until it is repaid. PayPal, Klarna, Affirm, Afterpay and others offer BNPL plans, often interest-free.
Among the biggest users of BNPL plans are Gen Z and millennials, who may see them as a way to make shopping easier in the short term. However, such plans can cause them problems in the long run if they are not careful.
In June, FICO announced plans to integrate BNPL data into its credit ratings starting this fall.
“These scores provide lenders with a more complete picture of consumers' repayment behavior, providing greater insight into their credit readiness, which ultimately improves credit quality,” FICO said in a press release at the time.
However, over-reliance on BNPL purchases can negatively impact your credit rating.
BNPL plans can lead to overspending by consumers, resulting in late payments, which are often reported to the credit bureaus and can negatively impact their credit rating. Consumers may also face late fees. BNPL plans typically only report late payments, so even if all payments are sent on time, it likely won't improve your credit score.
In November, a LendingTree report found that 41% of BNPL users reported late payments in the previous year. “Surprisingly, high-income borrowers are the most likely to be behind on payments, along with men, young adults and parents of young children,” LendingTree said.
