Equifax Adding Buy Now, Pay Later Payments to Credit Reports

https://www.nytimes.com/2021/12/31/your-money/buy-now-pay-later-loans-credit.html

“Buy now, pay later” online loans are getting attention from both regulators and the credit industry as consumers increasingly turn to them, and they may soon play a bigger role in credit scores.

Loans from financial technology companies, including Affirm, Afterpay and Klarna, offer an updated version of layaway plans, once a common option for shoppers to pay for big-ticket items in installments. The new offerings, widely available online or via mobile apps, are generally used for smaller purchases, like shoes, apparel and concert tickets, and allow the buyer to get the items right away.

The loans, which typically allow customers to pay for purchases in four equal installments rather than all at once, have exploded in popularity over the past few years, and are expected to keep growing. Equifax, one of the three main U.S. credit bureaus, announced earlier this month that it will begin recording these installment plans on reports in early 2022.

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