FICO and VantageScore have both announced updates to their scoring models that place greater emphasis on trends in financial behavior rather than static snapshots. The new models reward borrowers who demonstrate improving payment patterns over time.
Buy-now-pay-later transactions will now be factored into credit calculations for the first time, a change that could affect millions of consumers who use installment payment services for everyday purchases. Timely BNPL payments will boost scores while missed payments will carry penalties.
Credit industry analysts predict the changes will modestly increase scores for approximately 40 million Americans while providing lenders with more accurate risk assessments for underwriting decisions.
