Q&A with Block's Head of Credit and Underwriting on responsible lending, financial inclusion, and holiday shopping.
At Block, we believe the credit system has not only left too many Americans behind but also, many Americans are now choosing to forgo the traditional credit system, specifically Gen Z. Traditional credit products rely on outdated data, hidden costs, and revolving debt that younger generations want to avoid in favor of options that are more transparent and fair.
This shift reflects a deeper reality: people want credit to work with the rest of their financial lives rather than control them. At Block we’re working to build a more transparent, timely, and intuitive credit system. Our ecosystem of Cash App, Square, and Afterpay gives us near real-time visibility into how customers actually earn, spend, save, and repay – and SFS, Block’s industrial bank plays a critical role in our underwriting work. Our credit decisions are grounded in current financial health which we understand through our strong relationships with our customers.
As Block's Head of Credit and Underwriting, Juan Hernandez leads Block’s efforts to reimagine credit through innovative AI/ML and responsible lending practices. We sat down with Juan to discuss his vision for inclusive finance, how Block's approach differs from traditional models, and what customers should consider as we head into the holiday shopping season.
Juan: I've been at Block for about 10 years, working across Square, Cash App, and Afterpay. This gives me unique insight into how our ecosystem serves different customer needs while sharing the same purpose: economic empowerment. I started when we were focused on building and scaling Square Loans for small businesses. As we grew into Cash App Borrow and integrated Afterpay, I have worked with what I believe are the best credit machine learning (ML) teams in the world, using unmatched data and creativity to manage the entire portfolio. That advantage lets us expand access responsibly while making credit more intuitive for consumers and business owners.
What excites me most is that we’ve actively built financial inclusion into how our products are designed across the ecosystem. This is especially true with our lending products which have provided significantly more than $100 billion of liquidity to our customers across Square, Cash App, and Afterpay. Because customers already use our products to get paid, spend, save, and invest, our models continuously learn from that near real-time activity. The result, compared to traditional credit, is healthier engagement, more accurate decisions, and a credit experience that grows naturally with people’s financial lives.
Juan: Traditional scoring looks backward and often misses what really matters in someone’s financial life today, like day-to-day earning, spending, and saving activity. It relies on static reports and outdated proxies, which is why so many people with the ability to repay are either left out or misclassified as high risk.
Our approach is different. We use near real-time data across the Block ecosystem to understand how people manage money. With Cash App, for example, we see daily activity like paycheck deposits, spending, saving and repayment behavior. That gives us a living picture of financial health, not a snapshot from months or years ago.
Because of this, we can responsibly expand access where traditional models would say no. Seventy percent of Cash App Borrow customers have FICO scores of 580 or below, yet repayment rates are above 97 percent. That is only possible because our models are continuously learning from customer activity across Cash App and Afterpay. It is not just about making a single loan decision, but about building a credit experience that adapts with people’s financial lives.
Juan: For us responsible underwriting and innovation are inseparable. We have the best data, the best team, and the creativity to use both in ways that traditional models cannot. That is what makes Block special, this combination lets us manage risk with a level of precision that supports credit expansion without compromising on our risk standards.
It is also about alignment. Our products succeed when customers succeed. Repayment rates across Cash App Borrow and Afterpay are very high, which shows people are using credit in ways that work for them. We do not allow customers to take out new loans with past due balances, so we avoid the cycles of debt that other products serving underserved or subprime categories can be built on.
Juan: Not all data is created equal. Some lenders experiment with information like social media activity, browser histories, or education records. Those signals can feel invasive, are hard to explain to consumers, and regulators have already raised concerns about their fairness.
Our approach is very different. For us, “alternative data” is really just the most relevant financial activity happening both in near real-time and across a customer’s experience with our products – and it is often called “alternative data” because it is different from traditional lenders. Across Cash App, Square, and Afterpay we see income, deposits, spending patterns, and repayment behavior. That creates a clear and timely picture of financial health that goes beyond traditional credit files.
Juan: First, let’s clear one thing up: some headlines suggest BNPL is already dragging down credit scores. That is not true for our customers. Afterpay does not report BNPL data to credit bureaus in the United States today, so those stories do not apply to our customers.
It is not that we do not want to share data for customers who would see a benefit to their credit profiles. On-time repayment is a strong indicator of ability to repay, and we see that customers who repay well on one product often repay well on others across our ecosystem, and we would love for this good behavior to help customers demonstrate their financial responsibility when applying for rent, looking for longer term credit, or any other instance where traditional credit scores are used to measure payment ability. The issue is that short-duration products like BNPL do not map cleanly to legacy credit file categories such as “installment” or “revolving.” When these loans are forced into old formats, the models can misread healthy behavior and penalize responsible customers.
Until we believe that reporting customer data to credit bureaus will be beneficial to our customers, we will continue to not report information to credit bureaus – and will work with the industry and reporting agencies to further modernize reporting frameworks. Until safeguards around this data are in place, we are prioritizing consumer protection above all. Our goal is simple: make sure data helps customers by reflecting true ability to repay, not hurt them because the system is outdated.
Juan: The holiday season is all about giving, but it is also a time when budgets can get tight. Thinking ahead about how purchases fit into your overall cash flow and being intentional about your spending decisions makes the holidays easier to enjoy. Here are a few ways to think about holiday spending in a responsible way:
Juan: The future of credit will be based on actual repayment ability, not outdated proxies. 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.
As we shared in , our consumer underwriting model uses signals like paycheck deposits, spending, saving, and repayment to adapt continuously. It is the foundation for our lending products. It allows us to approve more customers than traditional scores at lower risk and keep repayment rates above 97 percent. That is only possible because we have the best data, the best team, and the creativity to apply both at scale.
This is also what customers want. because they see them as confusing and financially dangerous. They want products that fit their cash flow. Our underwriting model meets that need. It is a living measure of financial health that grows with people as they earn, save, invest, spend, and repay. The future of credit is a unified ecosystem where credit is part of everyday money management. Block is building that future now, and our underwriting model is a glimpse of what a fairer, more accurate financial system will look like.
Juan: It comes down to three things: what we’re building, how we build it, and what’s possible when that vision is a reality. Customers use our ecosystem to do things that traditional finance has often made difficult or impossible: a small business owner securing a Square loan to expand, a Cash App customer getting safe access to short-term credit through Borrow, or someone using Afterpay to manage their cash flow without falling into debt traps. Those moments of inclusion are what drive me.
As for how we build, at Block, AI and ML are not buzzwords or back-office experiments. They are embedded in product development across the business. Our ML engineering teams, who lead our credit strategy, sit side by side with product managers, engineers, and designers. That integration means we are always experimenting, thinking strategically about how we use ML, and designing the product and the risk strategy together so our models continuously learn from real customer activity and directly shape the customer experience.
We have invested in AI/ML since long before I joined Block, and it powers much more than lending. From fraud prevention to personalized offers to customer support, our teams are using these tools to improve the entire financial experience. We live and breathe this work, and I believe we have the best modeling and product teams in the world.
And finally, the vision we are building toward. We are not just improving credit models. We are changing how credit works. By grounding access in near real-time financial health, we are creating a system that adapts with customers, rewards responsible behavior, and opens doors for people who have been excluded. That is a future where technology makes credit simpler, fairer, and more human.
Juan Hernandez is Head of Credit and Underwriting at Block, where he leads efforts to democratize credit access through innovative data science and responsible lending practices. Before joining Block, Juan worked in traditional lending and financial services, focusing on the intersection of data science and financial inclusion.
Block's lending products include Cash App Borrow, Square Loans, and Afterpay, serving millions of customers with more than $100 billion in credit extended globally as of May 2025, while maintaining industry-leading performance metrics.
Square Financial Services, Inc. Member FDIC is a Utah-based Industrial Bank originating Square Loans to businesses and Cash App Borrow Loans to customers.
Q&A with Block's Head of Credit and Underwriting on responsible lending, financial inclusion, and holiday shopping.
At Block, we believe the credit system has not only left too many Americans behind but also, many Americans are now choosing to forgo the traditional credit system, specifically Gen Z. Traditional credit products rely on outdated data, hidden costs, and revolving debt that younger generations want to avoid in favor of options that are more transparent and fair.
This shift reflects a deeper reality: people want credit to work with the rest of their financial lives rather than control them. At Block we’re working to build a more transparent, timely, and intuitive credit system. Our ecosystem of Cash App, Square, and Afterpay gives us near real-time visibility into how customers actually earn, spend, save, and repay – and SFS, Block’s industrial bank plays a critical role in our underwriting work. Our credit decisions are grounded in current financial health which we understand through our strong relationships with our customers.
As Block's Head of Credit and Underwriting, Juan Hernandez leads Block’s efforts to reimagine credit through innovative AI/ML and responsible lending practices. We sat down with Juan to discuss his vision for inclusive finance, how Block's approach differs from traditional models, and what customers should consider as we head into the holiday shopping season.
Juan: I've been at Block for about 10 years, working across Square, Cash App, and Afterpay. This gives me unique insight into how our ecosystem serves different customer needs while sharing the same purpose: economic empowerment. I started when we were focused on building and scaling Square Loans for small businesses. As we grew into Cash App Borrow and integrated Afterpay, I have worked with what I believe are the best credit machine learning (ML) teams in the world, using unmatched data and creativity to manage the entire portfolio. That advantage lets us expand access responsibly while making credit more intuitive for consumers and business owners.
What excites me most is that we’ve actively built financial inclusion into how our products are designed across the ecosystem. This is especially true with our lending products which have provided significantly more than $100 billion of liquidity to our customers across Square, Cash App, and Afterpay. Because customers already use our products to get paid, spend, save, and invest, our models continuously learn from that near real-time activity. The result, compared to traditional credit, is healthier engagement, more accurate decisions, and a credit experience that grows naturally with people’s financial lives.
Juan: Traditional scoring looks backward and often misses what really matters in someone’s financial life today, like day-to-day earning, spending, and saving activity. It relies on static reports and outdated proxies, which is why so many people with the ability to repay are either left out or misclassified as high risk.
Our approach is different. We use near real-time data across the Block ecosystem to understand how people manage money. With Cash App, for example, we see daily activity like paycheck deposits, spending, saving and repayment behavior. That gives us a living picture of financial health, not a snapshot from months or years ago.
Because of this, we can responsibly expand access where traditional models would say no. Seventy percent of Cash App Borrow customers have FICO scores of 580 or below, yet repayment rates are above 97 percent. That is only possible because our models are continuously learning from customer activity across Cash App and Afterpay. It is not just about making a single loan decision, but about building a credit experience that adapts with people’s financial lives.
Juan: For us responsible underwriting and innovation are inseparable. We have the best data, the best team, and the creativity to use both in ways that traditional models cannot. That is what makes Block special, this combination lets us manage risk with a level of precision that supports credit expansion without compromising on our risk standards.
It is also about alignment. Our products succeed when customers succeed. Repayment rates across Cash App Borrow and Afterpay are very high, which shows people are using credit in ways that work for them. We do not allow customers to take out new loans with past due balances, so we avoid the cycles of debt that other products serving underserved or subprime categories can be built on.
Juan: Not all data is created equal. Some lenders experiment with information like social media activity, browser histories, or education records. Those signals can feel invasive, are hard to explain to consumers, and regulators have already raised concerns about their fairness.
Our approach is very different. For us, “alternative data” is really just the most relevant financial activity happening both in near real-time and across a customer’s experience with our products – and it is often called “alternative data” because it is different from traditional lenders. Across Cash App, Square, and Afterpay we see income, deposits, spending patterns, and repayment behavior. That creates a clear and timely picture of financial health that goes beyond traditional credit files.
Juan: First, let’s clear one thing up: some headlines suggest BNPL is already dragging down credit scores. That is not true for our customers. Afterpay does not report BNPL data to credit bureaus in the United States today, so those stories do not apply to our customers.
It is not that we do not want to share data for customers who would see a benefit to their credit profiles. On-time repayment is a strong indicator of ability to repay, and we see that customers who repay well on one product often repay well on others across our ecosystem, and we would love for this good behavior to help customers demonstrate their financial responsibility when applying for rent, looking for longer term credit, or any other instance where traditional credit scores are used to measure payment ability. The issue is that short-duration products like BNPL do not map cleanly to legacy credit file categories such as “installment” or “revolving.” When these loans are forced into old formats, the models can misread healthy behavior and penalize responsible customers.
Until we believe that reporting customer data to credit bureaus will be beneficial to our customers, we will continue to not report information to credit bureaus – and will work with the industry and reporting agencies to further modernize reporting frameworks. Until safeguards around this data are in place, we are prioritizing consumer protection above all. Our goal is simple: make sure data helps customers by reflecting true ability to repay, not hurt them because the system is outdated.
Juan: The holiday season is all about giving, but it is also a time when budgets can get tight. Thinking ahead about how purchases fit into your overall cash flow and being intentional about your spending decisions makes the holidays easier to enjoy. Here are a few ways to think about holiday spending in a responsible way:
Juan: The future of credit will be based on actual repayment ability, not outdated proxies. 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.
As we shared in , our consumer underwriting model uses signals like paycheck deposits, spending, saving, and repayment to adapt continuously. It is the foundation for our lending products. It allows us to approve more customers than traditional scores at lower risk and keep repayment rates above 97 percent. That is only possible because we have the best data, the best team, and the creativity to apply both at scale.
This is also what customers want. because they see them as confusing and financially dangerous. They want products that fit their cash flow. Our underwriting model meets that need. It is a living measure of financial health that grows with people as they earn, save, invest, spend, and repay. The future of credit is a unified ecosystem where credit is part of everyday money management. Block is building that future now, and our underwriting model is a glimpse of what a fairer, more accurate financial system will look like.
Juan: It comes down to three things: what we’re building, how we build it, and what’s possible when that vision is a reality. Customers use our ecosystem to do things that traditional finance has often made difficult or impossible: a small business owner securing a Square loan to expand, a Cash App customer getting safe access to short-term credit through Borrow, or someone using Afterpay to manage their cash flow without falling into debt traps. Those moments of inclusion are what drive me.
As for how we build, at Block, AI and ML are not buzzwords or back-office experiments. They are embedded in product development across the business. Our ML engineering teams, who lead our credit strategy, sit side by side with product managers, engineers, and designers. That integration means we are always experimenting, thinking strategically about how we use ML, and designing the product and the risk strategy together so our models continuously learn from real customer activity and directly shape the customer experience.
We have invested in AI/ML since long before I joined Block, and it powers much more than lending. From fraud prevention to personalized offers to customer support, our teams are using these tools to improve the entire financial experience. We live and breathe this work, and I believe we have the best modeling and product teams in the world.
And finally, the vision we are building toward. We are not just improving credit models. We are changing how credit works. By grounding access in near real-time financial health, we are creating a system that adapts with customers, rewards responsible behavior, and opens doors for people who have been excluded. That is a future where technology makes credit simpler, fairer, and more human.
Juan Hernandez is Head of Credit and Underwriting at Block, where he leads efforts to democratize credit access through innovative data science and responsible lending practices. Before joining Block, Juan worked in traditional lending and financial services, focusing on the intersection of data science and financial inclusion.
Block's lending products include Cash App Borrow, Square Loans, and Afterpay, serving millions of customers with more than $100 billion in credit extended globally as of May 2025, while maintaining industry-leading performance metrics.
Square Financial Services, Inc. Member FDIC is a Utah-based Industrial Bank originating Square Loans to businesses and Cash App Borrow Loans to customers.