Many online payment networks now allow instant installment plans for small retail purchases. Normally, the purchase would be a one time payment. These products transparently convert it to a payment plan, often without interest.

For example, PayPal has a service where instead of say, paying $60 for a pair of shoes, you can pay 4 installments of $15. This is implemented as a loan, so they ask for SSN, your credit history etc.

Does routinely using such services negatively impact your credit score?

1 Answer 1


It may. It will affect the credit utilization, account age, total debt, etc - all factors in determining the score.

It will also affect your record of on-time payments and paying off loans, which are positive signals.

  • Wouldn't the effects be minimal, because these payments are so small? Commented Oct 17, 2023 at 19:46
  • @gomennathan may be. Maybe not. Depends on variety of factors which change from model to model
    – littleadv
    Commented Oct 17, 2023 at 19:48
  • @gomennathan I imagine that if/when use of such services grows, credit scores will take them into account more, even if the (individual) amounts are small.
    – TripeHound
    Commented Oct 17, 2023 at 21:27
  • @TripeHound Interesting. I was more asking about the situation now. Commented Oct 18, 2023 at 18:01

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