Afterpay does not report to the major credit bureaus, so using it will not build your credit history or hurt your score when you pay on time
Afterpay is a buy now, pay later service that lets you split a purchase into four equal payments over six weeks, with the first payment due at checkout. Unlike a credit card or traditional loan, Afterpay does not report your account activity to Equifax, Experian, or TransUnion — the three major credit reporting agencies that calculate your credit score. This means that making on-time payments to Afterpay will not help your score go up, and paying as scheduled will not hurt it.
However, Afterpay can still affect your credit indirectly. If you miss a payment, Afterpay may send your account to a debt collector, and that collection account will show up on your credit report and damage your score. Additionally, some lenders look at your Afterpay payment history when you explore for credit, even though Afterpay itself does not report it.
Key Takeaways
- Afterpay does not report to credit bureaus, so on-time payments do not build your credit score.
- Missed Afterpay payments can be sent to collections, which will appear on your credit report and lower your score.
- Some lenders and credit card companies check your Afterpay history when you explore, even though the service does not report to bureaus.
- Using Afterpay responsibly — paying on time and not overspending — will not hurt your credit, but defaulting on it will.
What happens when you miss an Afterpay payment
If you miss a scheduled Afterpay payment, the service will charge you a late fee (currently $8 for most purchases under $40, and higher amounts for larger purchases). Afterpay will also attempt to collect the payment by retrying the charge on your linked debit or credit card. If you continue to miss payments, Afterpay may suspend your account and eventually send the debt to a third-party collection agency.
Once a debt collector takes over your account, that collection account will be reported to the credit bureaus and will appear on your credit report. A collection account is a serious negative mark that can lower your score by 50 to 100 points or more, depending on your current score and credit history. The collection account will remain on your report for seven years from the date of the original missed payment, even if you pay it off later.
How lenders view your Afterpay history
Even though Afterpay does not report to the credit bureaus, some lenders and credit card companies have begun checking Afterpay payment history as part of their underwriting process. They do this through alternative data sources or by asking you directly about your buy now, pay later usage. If you have a pattern of late or missed Afterpay payments, a lender may view you as higher risk and deny your process or offer you less favorable terms.
Credit card companies in particular are paying attention to buy now, pay later usage because they want to understand how much debt you are already carrying and whether you are struggling to manage multiple payment obligations. A history of on-time Afterpay payments will not help you, but a history of missed payments could work against you when you explore for a credit card, personal loan, or mortgage.
The difference between Afterpay and credit cards
A credit card reports all of your account activity to the credit bureaus — your balance, your payment history, and how much of your available credit you are using. This means that using a credit card responsibly (paying on time and keeping your balance low) will build your credit score over time. Afterpay does not work this way. It is a closed-loop service: you make four payments and the account closes. There is no ongoing account history to report.
This also means that Afterpay does not help you build a credit history if you are new to credit or trying to rebuild after past problems. If you want to improve your credit score, you will need to use a credit card, a secured credit card, or another product that reports to the bureaus. Afterpay can be a useful tool for managing cash flow, but it should not be your primary strategy for building credit.
Whether Afterpay shows up on your credit report
Afterpay does not appear on your credit report under normal circumstances. Your credit report lists accounts that report to the bureaus — credit cards, loans, mortgages, and collection accounts. Afterpay accounts that are paid on time will not show up at all. This is actually a benefit if you are trying to keep your credit utilization low, because Afterpay purchases do not count toward the credit utilization ratio that credit card companies report.
The only way Afterpay will appear on your credit report is if you default on payments and the account is sent to collections. In that case, the collection account — not the original Afterpay account — will show up on your report. This is why it is important to treat Afterpay payments as seriously as you would treat a credit card payment, even though they do not build your credit when you pay on time.
How to use Afterpay without damaging your credit
The safest way to use Afterpay is to treat each purchase as if you were paying cash upfront. Before you buy something, make sure you have enough money in your bank account to cover all four payments without struggling. Many people get into trouble with buy now, pay later services because they use them to spend money they do not actually have, betting that they will earn it before the payments are due.
Set a reminder for each payment date so you do not miss a important date. Afterpay sends notifications, but it is straightforward to overlook them if you are busy. If you know you will not be able to make a payment, contact Afterpay before the due date to discuss your options — the service sometimes allows you to reschedule payments or pause your account. Paying late fees and collection accounts are far more damaging than straightforward not using Afterpay at all.
Other buy now, pay later services and credit reporting
Afterpay is one of several buy now, pay later services available, and most of them work the same way: they do not report to credit bureaus when you pay on time, but they will send missed payments to collections. Klarna, Sezzle, Affirm, and PayPal Pay in 4 all operate under similar models. Some of these services are beginning to offer credit-building features — for example, Affirm reports to credit bureaus for certain types of purchases — but the majority still do not.
If you are considering using multiple buy now, pay later services, be aware that each one is a separate payment obligation. Missing payments on one service will not affect the others directly, but it will damage your credit if it goes to collections, and it may make lenders less likely to approve you for other credit products. Treat each service as a separate debt that you need to manage carefully.
Frequently Asked Questions
Will paying Afterpay on time help my credit score?
No. Afterpay does not report to credit bureaus, so on-time payments will not build your credit history or raise your score. If you want to build credit, use a credit card or a secured credit card instead, which do report to the bureaus.
Can I get a collection account removed from my credit report if I pay off the Afterpay debt?
Paying off the debt will stop the collection agency from pursuing you, but the collection account will remain on your credit report for seven years. You can try to negotiate a pay-for-delete agreement with the collection agency, but they are not required to agree. Even after you pay, the account will still lower your score until it ages off your report.
Do credit card companies check my Afterpay history when I explore?
Some do, though it is not standard practice yet. If you have missed Afterpay payments, a credit card company may see that history and use it as a reason to deny your process or offer you a higher interest rate. On-time Afterpay payments will not help you, but missed ones can hurt you.
What is the difference between Afterpay and a credit card in terms of credit building?
Credit cards report all activity to credit bureaus, so on-time payments build your credit score and help you establish a credit history. Afterpay does not report at all unless you default. If building credit is your goal, a credit card is the better choice.
If I use Afterpay and miss a payment, how long will it hurt my credit?
A collection account will lower your score when ready and will remain on your credit report for seven years from the date of the original missed payment. The impact on your score will lessen over time, especially if you build positive credit history with other accounts, but the account will not disappear until seven years have passed.