Your Klarna Habit Is on Your Credit Report Now

For almost a decade, these four easy payments in the checkout could go unnoticed in the background. You could have had a dozen pay-in-four plans running in the background and none would be reflected on your credit file. Lenders termed it phantom debt, worth about $70 billion annually by the Richmond Fed's estimate, and effectively invisible to the credit system.

That blind spot is closing in. Credit scoring giant FICO now offers scores that factor in BNPL behavior, the top BNPL providers now report your plans to the credit bureaus, and the question is no longer whether this will count but "how will it hurt me?". Here's what you should be asking yourself if you're one of an estimated 91.5 million Americans who use the loans.

Does it count on my credit report now?

Depends on who you got it from.

• Affirm: generally, yes, for all of their products. Starting in April of 2025 all pay-over-time plans, including the formerly unseen Pay in 4, were reported by Affirm to Experian, followed by TransUnion in May 2025. These will appear on your credit report along with payment history, loan amounts, and terms.
• Klarna: in some cases. Only Klarna's longer (6- to 24-month) loan options count on a customer's credit reports with TransUnion and Experian. Klarna has stated that it did not want to penalize its users for what it considered typical usage because its scoring models were not built for someone paying back several smaller installments per month.
• All others: a mixed bag. Some services are reporting to some bureaus, but not others; the CFPB's December 2025 market report described the coverage as expanding but not yet universal.

The simple answer is "sometimes," with the scope increasing each quarter. All signs point toward this becoming the norm. Since Affirm announced it was working with FICO, competitive and regulatory pressures have logically followed for other companies.

Will it help or hurt my score?

This is where the new FICO models come in. The scoring models are called FICO Score 10 BNPL and FICO Score 10 T BNPL, and they became publicly available in late 2025. The most significant difference here is how the model handles BNPL loans: your BNPL usage is aggregated rather than each individual pay-in-four installment counted separately.

This means four small loans can read as one. Under the old scoring rules, four small installments made in a month could make you appear to lenders like you were in financial distress, but under the new FICO model it is viewed more as a single modest line of credit. It's also reported that in their own studies over a year, certain BNPL users actually saw their score increase due to having their payment history reflected in their score. Younger users with limited credit files may particularly benefit from building a credit history, even one based on relatively small installments.

On the other hand, a late payment on a BNPL loan now carries a much heavier weight than in the past. A $9.99 fee, which was likely waivable, is being replaced by a permanent mark on your credit file. The share of BNPL users who paid late has increased to 47%, according to LendingTree's 2026 report, up from 41% in 2025 and 34% in 2024. The score models are built to pick up these trends in late payments.

The catch is adoption is still catching up. Most mortgage lenders are using the older, legacy FICO models, but many will catch up over the next few years. While the data is being collected now, the lender you're working with might not be able to see it for a while yet, so don't panic for now.

So, how much of this debt is there really?

There's a significant amount of debt and it's growing, but perhaps not as much as it appears. The Richmond Fed stated it accounted for roughly $70 billion in transaction volume last year, with real growth of about 20% annually since 2021. This still represents a very small fraction compared to the $1.25 trillion Americans currently owe on their credit cards (a slight dip from $1.28 trillion in the New York Fed's Q1 2026 report).

The most significant impact, however, comes from who holds this debt. This $70 billion is concentrated among people who are already in a vulnerable financial situation: the CFPB found that 18% of BNPL users had missed payments on other accounts, compared to 7% of consumers who do not take BNPL loans, and their credit card delinquencies are three times higher than their peers. BNPL is not likely the root of these problems, but it is concentrated where those issues already exist.

The default rate is low. In a report by the CFPB, around 2% of loans were charged off, likely because the loan amounts are so small and providers often waive fees when asked. BNPL loans are less like payday loans and more about the normalization of borrowing small amounts and the long-term consequences it carries.

Who is at the highest risk?

These three types of people:

Loan Stackers: The people using multiple BNPL providers and benefiting from this system where no individual lender could see their entire debt burden. Now that these companies are reporting to the credit bureaus, their individual debts will begin to paint a picture on their credit reports, even with the aggregation used by the new FICO model. Chronic overspenders may struggle as the information is revealed.

The Perpetually Late: That 47% figure suggests these fees were a cheap cost for missing a payment. A late mark will remain on your report for years to come and has significantly higher repercussions than a $9.99 fee.

Anyone Applying for a Mortgage Soon: Mortgage scores do not always reflect BNPL data, but loan officers may still look at it. An abundance of installment loans may trigger red flags.

If you are on top of your payments and use BNPL only sparingly, you should view this change favorably. You'll finally get credit for behaviors that previously went unnoticed.

What should I do before my next checkout?

Don't make any drastic changes, but remember that the best credit card advice also applies here: always enable autopay for any BNPL plan. Even a missed $25 installment could damage your credit score. Try to stick with a single provider to keep track of your total BNPL debt. Most importantly, before splitting up a purchase into four equal payments, ask yourself: can I afford to pay for this all at once, right now? If not, will four separate payments fix that problem?

The larger shift needs thoughtful consideration. The main draw to BNPL has been that it did not count: no hard inquiries, no credit reports, no consequence beyond your immediate transaction. That era has passed, replaced by one where credit bureaus fill the void with data. Four easy payments always were a loan; now, they'll look like one.