What is buy now, pay later? Credit files and new EU rules

Buy now, pay later is a loan, even when it’s a pair of trainers split into three with one tap on “Pay in 3” at the checkout. I think it’s a perfectly reasonable way to buy small things, one plan at a time, for a sum you could pay today.

Whether it goes on your credit file depends on the country. In some countries, Portugal and Slovenia among them, a plan can be recorded while you’re still paying on time. France waits until a payment goes wrong. And many small plans never reach a public register at all. The answers for eight countries come from their registers, the providers’ own terms and notices, and in Germany the data protection law. All checked on 31 October 2026.

Most of the trouble arrives by post. In several countries the law wants you warned before a missed payment goes on record, so the boring letters are worth opening. If one is already open on the table, go straight to what to do about the letter.

Europe sells it in two shapes, instalments or one bill about 30 days later.

What is buy now, pay later, and is it a loan?

You pay a provider such as Klarna, PayPal, Scalapay or Riverty instead of the shop, in three or four instalments or in one go after about 30 days. It’s a small loan, taken out at the checkout. The EU’s new consumer credit rules, due to apply from 20 November 2026, treat it as credit.

The Central Bank of Ireland ↗ (opens in new tab) says the same in its consumer guide.

Buying things in this way is the same as using a loan, even when no interest is charged.

Klarna’s own Irish Pay in 3 terms ↗ (opens in new tab) call the deal a credit agreement. The provider pays the shop, and you owe the provider. Klarna’s annual report ↗ (opens in new tab) says about three-quarters of its transaction and service revenue in 2025 came from shops. So it’s often free to you if you pay on time. I think it’s an odd sort of loan, where you’re the one borrowing but the shop is where most of that revenue comes from.

For the rest of the checkout page, see how shops trick you into spending more.

How does pay in three, or four, work?

The price is split into three or four instalments, taken over the next few weeks or months. In France it’s the familiar paiement en 3 fois sans frais. Elsewhere it tends to be Klarna or PayPal, in their own shade of pink or blue, and in Italy you’ll also meet Scalapay.

How does pay in 30 days, or by invoice, work?

You get the goods first and pay the whole bill later. It’s the older habit of paying by invoice, with an app on top, called Kauf auf Rechnung in Germany and achteraf betalen in the Netherlands. Klarna’s German terms set the deadline at 30 days from dispatch.

The Dutch regulator, the AFM ↗ (opens in new tab), says paying later has a real point in its favour, because you pay only for what you actually receive and decide to keep. In its 2024 data from four providers, 39% of users of the pay-the-whole-bill-later kind got a formal default notice, against 10% of instalment users. The letter gives you a last free chance to pay before costs can be added.

A credit card is one line of credit that stays open, purchase after purchase. Each pay-later plan is a separate small loan for one purchase, with its own provider and its own dates.

Does buy now, pay later affect your credit file?

Buy now, pay later can show up on your credit file, but whether a plan of yours does depends on where you live, and often on the provider. Europe has no single credit file. There are central-bank registers and private bureaus, and some countries have both, each with its own rules about what goes in.

Klarna’s notices for Spain, Italy, Germany, the Netherlands and the UK say it sends nothing to a credit bureau for small amounts, or when it already has enough information, without saying where “small” starts. For Scalapay, Riverty or another provider, check its own privacy notice.

Once your country applies the new EU rules, you must be told within 30 days of a missed payment being registered in a database used for credit checks. A lender that turns you down because of such a check also has to tell you which database it used.

Is buy now, pay later actually free?

Often free. Even if you pay on time, some providers charge a fee per purchase or for a longer plan, and plenty charge when you’re late. Several small plans with different providers are what I’d watch hardest. Below a register’s limit, with providers that don’t report, or on a problems-only register like France’s, no single lender sees the total.

What does it cost when it isn’t free?

These are each provider’s published figures (examples as of October 2026, not endorsements, not advice, verify current figures before acting). Klarna’s German invoice terms ↗ (opens in new tab) allow an invoice fee of up to €6 per purchase. Oney ↗ (opens in new tab) says its plans in three or four are free only when the shop offers them that way. Otherwise €150 paid in three costs €2.51. That sounds like nothing, though Oney itself states it as an annual rate of 22.59%. Whether your three payments are sans frais is up to the shop.

Klarna’s Irish Pay in 3 terms ↗ (opens in new tab) charge up to €8 per late instalment, at most two per purchase.

Why can’t one lender see the total?

A small plan with another provider may sit on no register at all. And the European consumer group BEUC ↗ (opens in new tab) found in 2022 that the quick check at the checkout often looked only at the money passing through the provider’s own platform.

What happens if you miss a payment, or a debt collector writes?

It usually goes in the same dull order. A reminder comes first, by post or in the app, then a late fee if the provider charges one. Then more reminders, then a debt collector or a credit file entry. In several countries the law wants a warning first, before a missed payment is recorded or collection costs are added.

Open the first reminder the day it comes.

If a letter from the provider or a debt collector is already on the kitchen table:

1. Check the claim in the provider’s own app, or on its website with the address typed in yourself. Don’t use the links, QR codes or phone numbers in the letter. Fake collection letters exist, and the Verbraucherzentrale in Brandenburg ↗ (opens in new tab), in Germany, keeps a blacklist of the collection details and bank accounts they use. If the app shows nothing owed, ask the provider in writing whether it passed or sold the debt to a collector. Keep the letter’s deadline in view meanwhile.
2. If you’ve paid or sent the item back, tell the provider in writing and attach the proof, such as the refund confirmation or the return receipt.
3. If you do owe it, pay it, or ask whoever is collecting it (the provider or the collector) for a payment plan before the deadline in the letter. Before you sign a payment plan, check that it lists only what you actually owe, because signing it can count as agreeing you owe the debt and whatever costs it includes.

A document from a court runs on its own reply deadline, and checking the app doesn’t pause it. If one arrives, act on the document itself within the time it gives, by paying or by replying to the court as it says. That time often runs from the date of delivery, which can be earlier than the day you pick the letter up. So keep the envelope or delivery slip with its date. And get debt advice straight away.

Be fussy about returns. Report a return or a faulty item in the app before the payment is due. Keep proof of the return, such as the little receipt the parcel shop prints, until the refund shows. PayPal’s German pay-in-30 terms ↗ (opens in new tab) say a payment can still be taken on the due date if the shop hasn’t received or processed your return yet.

In France, the Banque de France estimates ↗ (opens in new tab) that 16.4% of over-indebtedness files handled in 2025 included a debt from split payments or mini-credit, the two counted together. If more than one plan has gone wrong at once, tell each provider early, and speak to a debt adviser.

Ireland’s Money Advice and Budgeting Service, MABS ↗ (opens in new tab), says its service is free of charge, in case the cost was going to talk you out of ringing. In the Netherlands, the state funds your local council to help residents with debt for free ↗ (opens in new tab). Germany has recognised debt advice services ↗ (opens in new tab) at councils, charities and the Verbraucherzentrale. Elsewhere in the EU, the new rules require your country to make debt advice available at limited cost.

What do the new EU rules change at the checkout?

From 20 November 2026, once your country applies them, the new rules mean a real check at the checkout that you can afford it, scaled to the amount. You also get an information sheet before you agree.

Klarna tells shops, who I imagine were relieved to hear it, that most shoppers will “never be asked” any questions. Some may see one or two extra steps, it says, such as a question about income or expenses.

The rules are the EU’s, and they reach you through your own country’s law, which may not be finished yet where you live ↗ (opens in new tab). A plan you opened before 20 November 2026 keeps the old rules until it ends.

You also get 14 days to cancel the credit ↗ (opens in new tab), no reason needed. Cancelling still means repaying the amount you borrowed, normally the price, plus any interest, within 30 days of telling the provider. In Germany, cancelling a linked credit ↗ (opens in new tab) undoes the purchase too, so the goods go back instead. And across the EU, if you cancel the purchase itself under an EU right to withdraw, such as the one for online and doorstep purchases, the linked credit goes with it.

What’s worth doing before your next pay-later checkout?

Ten minutes with each provider’s app will cover it. Write down every open plan and the date each payment falls due, in one place that isn’t any of the apps, even if that’s the back of an envelope. There’s a whole psychology of spending behind why a price split in three gets filed away as a third of itself. Where the dates bunch up in one week, sort that week first, by putting off the next purchase or paying one plan early.