Buy Now Pay Later seemed like a good idea at the time: interest free, loan-free money. Unfortunately, now, however, the three major credit reporting companies will now factor your Buy Now Pay Later (BNPL) transactions into your credit score. Let’s examine how we got here, what it mean now, and what other financial events are ahead.
BNPL
For several years now consumers with both low and high scores were able to take advantage of BNPL purchases without consequences. One could purchase an item today, start payments at a later date, and spread the payments across several months without incurring any interest if you made your payments on time when it was time to start paying. In an April Lending Tree survey, at least half of Americans ages 18 to 79 acknowledged using BNPL plans to finance their lifestyles. This was all good until this past June when the Fair Isaac Corporation (FICO) announced that BNPL transactions are now going to be included in determining your credit score. So what’s the problem?
For many consumers who were already struggling to establish some type of credit, this will almost be the kiss of death. For people who struggle to get credit, it is sometimes difficult to even make consistent payments under a BNPL plan. According to the Lending Tree Survey, about four out of every 10 BNPL customers have admitted to at least making one late payment.
Consumers who use these plans must treat these plans as loans. If, for example, a consumer wants to purchase an item costing $1,000, the BNPL plan may require them to make four payments of $250, starting with an immediate payment or deposit of $250. But then, keep the perspective that the remaining balance of $750 is just like a loan. It as an interest free loan for four months, and no different from any credit card transaction. The biggest point here is that it is still debt and will need to be repaid.
So, back to FICO, these reports now have two expansions in the FICO 10 series: the FICO Score 10 BNPL and FICO Score 10 T BNPL. These may be available for an additional report fee from FICO.
Changes in Fund Availability
In other news, July traditionally brings about changes in the law, and the Consumer Financial Protection Board and the Federal Reserve have increased the amount of funds that are available to you the day after making a deposit. Through the Expedited Funds Availability Act, Effective July 1st, 2025, if you deposit a check in the amount of $275 or more, $275 will be available the same day or the next day. The balance will be available on the third business day. There is also a change in the large deposit threshold availability, which increased to $6,725 from $5,525. If the deposit exceeds $6,725, the balance may take up to nine business days to clear.
Second Half Upcoming Money Events
In my January Money Mondays I shared with you some of the money events occurring during the first half of this year 2025. Here are some second half money events worthy of note taking.
July: New Interest Rates on Student Loans; Amazon and Target sales date July 9th
August: In many states, sales tax holidays start on August1st for back-to-school shopping; Labor Day sales on major appliances.
September: On September 15th, your estimated taxes are due if self employed or a 1099 employee.
October: Last good time to book Thanksgiving and Christmas flights–do it by 10/14; also, last day to file tax returns if you filed an extension 10/15; Open enrollment period for Medicare Advantage.
November: 11/6 National cash back day; 11/10 open enrollment for employer provided health insurance ; 11/28 Traditional Black Friday shopping
December: 12/2 Giving Tuesday; 12/15 Time to withdraw your RMD’s ( Required Minimum Distribution) before December 31; 12/20 Sell underperforming stocks at a loss to offset gains.
WHAT’S UP! Today’s What’s Up is about the best online shopping tools. Here are some tools that can help you keep up with discounts and changing prices. Camelcamelcamel website may be used by Amazon.Com shoppers to track changing prices. You can see the item’s history, prices, and when it drops. Honey is another browser you can use that automatically applies coupons when you check out of over 30,000 e-commerce sites. And that’s what’s up!
Ruthven R. Phillip, Esq., is a tax attorney, Stewardship and Philanthropy Ministry Assistant, and CEO of Give2Getrich, LLC. Give2Get Rich, LLC 2025. All Rights Reserved. Any distribution or reproduction of part or all of the contents in any form is prohibite
