FICOs Are 580 and Below, Repayment Rates Are Above 97%

Block recently published an interview with Juan Hernandez, the company’s Head of Credit and Underwriting for its consumer lending divisions. Among the most interesting details Hernandez revealed is that 70% of Cash App Borrow customers have FICO scores of 580 or below, but their repayment rates are above 97%.

“That is only possible because our models are continuously learning from customer activity across Cash App and Afterpay,” Hernandez said of it.

Block sees income, deposits, spending patterns, savings behavior, and repayment behavior across the spectrum of its ecosystem and is able to use that data to make better predictions than legacy third party credit indicators.

“The future of credit will be based on actual repayment ability, not outdated proxies,” Hernandez said. “With near real-time data and modern modeling, we can finally build a system that is more inclusive and safer than traditional credit scores that look backward, update slowly, and often misclassify people who are capable of managing credit.”

Block has made a name for itself in the lending space. Cash App Borrow originated $9B in loans in 2024 while its sister company Square Loans, which provides capital to small businesses, is the largest online small business lender that deBanked tracks. Square Loans originated $5.7B in 2024.

In March of this year Block received FDIC approval for its industrial bank, Square Financial Services Inc, to offer the Cash App Borrow loan product directly.