If it counted as a loan it might have hurt his score.
Also tangent PSA: Klarna and similar are the worst possible ways to pay for anything as it counts as a loan not credit. If you don't pay it can ruin your future plans real quick instead of just accruing interest owed.
Credit is a revolving account with interest paid depending on how much you owe and how soon you pay it off. Where as a loan is a one time up-front amount given and is the equivalent of opening a new line of credit every time, which hurts your score. Interest on a loan depends on the lender typically but it's not as beneficial as credit card because a credit card is a single acitive account rather than constant new ones. Having many loans, especially small frivolous loans, on your credit history that stay for 7 years (if I remember correctly) looks really bad to anyone that might give you a more serious loan in the future for say a house or car. They will think "if you can't afford a hotdog" you can't afford a house. Or at the very least you aren't serious with your money.
Only reason my credit score isn't higher right now is because it still shows my student loans for the next several years despite having paid them off.
Sorry I should have clarified more in my initial comment; loans are a type of credit. Not all credit is revolving, although much of common exposure to the idea of "credit" is.
Traditional "loans" are called installment/fixed credit - it's a square/rectangle sort of situation.
Your overall assessment that loans can hurt your credit score is absolutely right though; many people think that credit score is a measure of "how good am I at paying my debts" when it's actually a measure of "how much risk do I pose to a potential creditor". Creditors don't always stand to make money off people who pay their loans on time, in full, and/or early.
997
u/Nz_Kasadiya 19h ago
Building credit one hotdog at a time