Tag: BNPL

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HM Treasury publishes ‘Phase 1’ consultation on consumer credit reform, and response to feedback on plans to regulate BNPL

Earlier today, on 19 May 2025, HM Treasury published:

– a press release and a ‘Phase 1’ consultation paper on reform to the Consumer Credit Act 1974;

– an update to its consultation and its response to the feedback to its consultation on regulating buy-now, pay-later products (BNPL); and

– a news story on its proposals to regulate buy-now, pay-later.

The ‘Phase 1’ consultation on reform seeks views on information requirements, sanctions and criminal offences. The deadline for responding is 21 July 2025.

On BNPL, HM Treasury “intends to lay the [statutory instrument] before Parliament shortly after this responsible is published”. Once the SI is made, the FCA will then have 12 months to draft, consult on, and finalise its rules for BNPL Lending. BNPL products will then be regulated from mid-2026. The FCA will shortly publish a consultation on its rules.

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FCA secures contract changes for BNPL customers

On 31 October 2023, the UK Financial Conduct Authority published a press release setting out the contract changes to buy-now pay-later products it had secured from both PayPal and QVC.

The FCA’s view was the follow terms were potentially unfair or unclear for customers:

– (for both) the terms dealing with continuous payment authorities; and

– PayPal’s terms on what happens when a consumer cancels their purchase funded by the BNPL agreement.

The FCA also published:

– the undertaking given by PayPal (Europe) S.à.r.l. et Cie, S.C.A.; and

– the undertaking given by QVC UK.

The FCA used its powers under the Consumer Rights Act 2015 to secure the changes.

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Government publishes consultation on regulation of unregulated Buy-Now Pay-Later

On 21 October 2021, the UK Government published a webpage and a consultation on the proposed regulation of unregulated (or, more accurately, exempt) buy-now pay-later (often called BNPL) agreements.

This consultation follows the recommendations set out in The Woolard Review, and the Government’s announcement on 2 February 2021 that it intended to bring unregulated interest-free BNPL products into regulation.

The consultation asks a number of questions and sets out some of the Government’s thoughts on how the regulatory regime may work for BNPL agreements.

The deadline for responding is 6 January 2022.