FICO’s New BNPL-Integrated Scores Are Coming; Here’s Why Business Lenders Should Pay Attention

In a move that signals a major evolution in how creditworthiness is assessed, FICO is launching two new credit scoring models that will include Buy Now, Pay Later (BNPL) activity. Known as FICO Score 10 BNPL and FICO Score 10 T BNPL, these models will mark the first time that short-term, point-of-sale installment data is factored directly into consumer credit scores.

While this shift is being framed primarily as a consumer credit development, it has important, and likely underestimated, implications for the business lending space. For lenders that rely on personal FICO scores as part of their underwriting process, especially when evaluating small business owners, this is a game-changer.

What’s Changing with FICO Scores?

BNPL services like Affirm, Afterpay, Klarna, and others have become widely adopted, especially among younger consumers and credit-thin borrowers. But until now, those payment histories rarely made it into traditional credit files. That created a blind spot—lenders couldn’t see if a borrower was responsibly managing multiple installment plans or if they were quietly accumulating unsustainable short-term debt.

FICO’s new models aim to close that gap.

The inclusion of BNPL data will offer a more complete picture of consumer behavior. Early simulations show that for many borrowers, this added visibility could actually improve their credit scores, particularly for those with little other credit history but strong BNPL payment patterns. However, the opposite will be true for borrowers who miss payments or who over-leverage themselves across multiple BNPL providers.

How This Impacts Business Lending

Many small business lenders, including fintechs and alternative funders, use the personal credit score of the business owner as a key part of underwriting. Whether it’s a merchant cash advance, a working capital line, or a term loan deal, a strong FICO score can often make or break the approval decision or funding amount.

Here’s why the BNPL update matters:

• Better Risk Assessment: Lenders will gain access to data that reveals how applicants manage short-term obligations. This is especially useful for evaluating newer entrepreneurs or sole proprietors with thin credit files.

• Early Credit Building: Many business owners start their ventures before establishing business credit. If they’ve responsibly used BNPL options, it could now work in their favor and open up more funding opportunities.

• Red Flags Exposed: On the flip side, heavy usage or delinquencies on BNPL platforms could result in lower credit scores, leading to declined applications or tighter terms, even if the applicant has no defaults on traditional credit.

• Segmentation Strategy: Funders may begin to segment their personal credit-based risk models further, differentiating between traditional delinquencies and BNPL-specific issues.

What Lenders and Brokers Should Do Now

1. Monitor Adoption: These new scores won’t roll out everywhere overnight. Many lenders still use FICO 8 or 9. But as credit bureaus and platforms begin incorporating BNPL data, prepare for integration into your approval logic.

2. Educate Borrowers: Start informing applicants that BNPL behavior may soon affect their personal credit. Many consumers still assume these purchases are invisible to creditors.

3. Update Underwriting Guidelines: Consider how BNPL patterns should influence decisions. Will your policy allow for “light” BNPL use with on-time payments? Will heavy use without missed payments be neutral or negative?

4. Watch for New Data Tools: Expect credit bureaus and aggregators to begin offering BNPL-specific analytics or breakdowns. These tools may become essential for accurately grading borrower profiles soon.

Looking Ahead

This move by FICO reflects a broader trend toward holistic credit scoring that captures real-world behavior, not just revolving credit utilization. For consumers, it could be a blessing or a curse, depending on their habits. For lenders, it’s an opportunity to get smarter about risk, but it also introduces new variables to watch closely.

As BNPL adoption continues to rise and credit data becomes richer and more nuanced, lenders that adapt early will be better positioned to fund the next generation of borrowers responsibly and profitably.