Over 10 million people who use Buy Now, Pay Later (BNPL) products will gain stronger rights and clearer protections under new rules, stopping unaffordable borrowing and helping families keep more of their money.
New rules include affordability checks to stop people racking up unaffordable debt and faster access to refunds to protect working people as part of the Plan for Change.
That means upfront checks to make sure people can repay what they borrow, fairer and faster access to refunds and the right to complain to the Financial Ombudsman, bringing BNPL in line with other credit products.
The changes will boost consumer confidence while giving firms the certainty they need to innovate, grow and invest – delivering on the government’s Plan for Change to grow the economy, unlock investment, create jobs and put more money into people’s pockets.
Emma Reynolds, Economic Secretary to the Treasury, said: “Buy Now, Pay Later has transformed shopping for millions, but for too long has operated as a Wild West, leaving consumers exposed.
“These new rules will protect shoppers from debt traps and give the sector the certainty it needs to invest, grow and create jobs through our Plan for Change.”
The announcement is backed by new reforms to the Consumer Credit Act, which will replace a 50-year-old regime with a modern, pro-growth framework that reflects how people borrow today.
