FICO Announces Plan to Add BNPL to Credit Score Calculations

Core Insights - FICO plans to incorporate buy now, pay later (BNPL) data into its credit score analysis following a joint study with Affirm, indicating a shift in credit scoring methodologies [1][2] - The study revealed that over 85% of consumers who opened a new BNPL account experienced a consistent impact on their FICO scores, suggesting potential benefits for both consumers and lenders [3] Group 1: Study Findings - The study compared FICO scores of over 500,000 consumers with at least one new Affirm BNPL loan against a benchmark population without such loans, demonstrating the potential positive impact of BNPL data on credit scores [2][3] - The inclusion of BNPL data could lead to score increases for some consumers while enhancing model risk performance for lenders, highlighting the importance of BNPL data in the credit ecosystem [2][3] Group 2: Consumer Trends - Over 56% of consumers reported using BNPL options last year, with 76% of these users expressing high satisfaction levels, indicating a growing acceptance and reliance on BNPL services [4] - Consumers living paycheck-to-paycheck are four times more likely to utilize BNPL options compared to those who are not, showcasing the demographic's dependence on such financial solutions [4]