Now buy, pay later Lenders It should now be investigated that people can take the risk of repaying their debt, put forward by a consultation Financial conduct authority (FCA) says.
If customers get financial difficulty in the over -safety manifested by FCA, providers should also offer support to providers.
Borrowers will also be able to complain Financial Lokpal service If something goes wrong.
Rules, giving Consumer More transparency about this type Borrow Included, now it will be effective on purchasing, pay later (BNPL) falls under the Remit of FCA next year.
New inspection by FCA would mean that BNPL borrowers will have significant protection that already exist for other types of borrowings.
The FCA also oversees consumer duties, which require financial firms to keep in the heart of what they do, including designing products and communicating with their customers.
Deputy Chief Executive Officer Sarah Purand in FCA said: “We have long called BNPL products to be brought into our remit, so people can benefit from BNPL during their preservation.
“Our regulation will help consumers navigate their financial life, with investigation on whether they can repay, when things go wrong and reach the correct information to make informed decisions.
“We are mainly relying on existing requirements, including consumer duties, rather than proposing to create a lot of new rules, support development and to innovate the firms.”
BNPL product is a way to spread the cost of purchase without paying interest for people. BNPL options pop up regularly on online checkouts.
But concerns have been raised that some people may eliminate the loans that they cannot pay back on time, instigating the allegations.
According to FCA research, one of the five (20%) UK is equal to 10.9 million – BNPL was used at least once in 12 months to May 2024, above 17% in 2022.
In May 2024, 2% of the UK 2% adults (equivalent to 1.1 million) had £ 500 or more outstanding irregular BNPL loan, and 11% UK adults (5.3 million) had £ 50 or more outstanding, £ 50 or more, Regulator found.
FCA consultation is open to the response by 26 September 2025.
A temporary permissions will be open to register the firms two months before the implementation of the government on 15 July 2026.
The firms will be six months from the date of six months when the government applies to apply for the full authority.
BNPL is a broad term that may include some Credit The FCA stated that the agreements that are already regulated.
Its new proposals relate to irregular BNPL agreements, called the deferred payment credit (DPC).
Government has formed Legislation To bring DPC products under FCA regulation.
The DPC refers to irregular interest-free credits, which funds the purchase of goods or services and is worth paying in 12 or less installments within 12 months or less.
Lenders who only provide DPC do not need to authorize FCA currently, which is concerned that some borrowers may not get enough information about what credit agreements include.
Alison Walters, Interim Director of Consumer Finance at FCA, told the PA news agency, “Our proposals are to ensure that consumers get good consumer results and have a reasonable degree of consumer protection.
“And by this, we mean that consumers get the right information at the right time, so that they can take an informed decision about their purchase, later pay the loan.”
He continued: “What we are asking in our rules is to conduct an ability to check for the firms, to make sure that consumers are able to pay. And if they are found in financial difficulty to provide them with proper level support.
“We also want them to give more information about late fees, the results if they remember the payment, and for example, if it can affect the credit rating.
“And also information about their right to return and cancellation.”
He said: “If something goes wrong, the consumers will be able to refer to their complaint in the financial Lokpal service.”
Ms. Walters stated that in terms of supporting those in financial difficulty: “Under our current rules, firms may refuse consumers when consumers are in financial difficulty.”
He said that the payment scheme may include changes and people may also be signed loan advice or other support mechanisms.
Ms. Walters said that under the new rules, “We still think that this market will be viable and profitable”.
He said that the BNPL market has already increased in size and popularity.
According to the regulator, DPC lending has increased from £ 0.06 billion to more than £ 13 billion in 2024.
A spokesman from Clarna said: “After five years of creative work with HMT (HM Treasury), we are entering the house directly to make BNPL regulation reality – a big win for the UK consumers.
“We are eager to work with FCA on the rules protecting consumers with options and innovation at the center of the UK Credit Market.”
A spokesperson of BNPL provider Clearpe said: “We will support FCA as it finalizes and finalizes its specific rules for the region.”
The spokesperson said that regulation “would set up a coherent operating environment and clear compliance standards for all providers,” Saying: “Clearpe Research said that about half of the UK is more likely to use BNPL, once more likely to use BNPL, with once the regulation is passed, it is important for BNPL that it is important to announce the UK financial law, today.
“It will also create a more sustainable foundation for the future of BNPL as it grows as a daily payment option for consumers.”
Vicky Bronzez, Chief Executive Officer of Stepachen Date Charity, said: “It is incredibly assured to now pay the FCA counseling on your proposed approach to buy, pay later.”
He said: “While BNPL can be a useful budget tool, it can deepen debt problems, and it is borne to a vital struggling consumers with equal level protection for other forms of credit.
“Bringing BNPL firms to suit a comprehensive credit market, when the regulation begins next year, will provide an additional layer of security for consumers, as a very important change in steps polling, BNPL users are doubled as all credit users to cover the required bills, and our research has also found that it has also been found that the general research has found that the general research has been found to use an overdraft between BNPL UK. Is.”
Vicks Lon, a consumer expert from app Thinkmani, said BNPL “can be a really useful tool, especially when life throws you an unexpected cost that runs a debris ball through your budget.
“But can overcome the pressure while spreading the cost, it is temporary relief if it is not done by responsibility and mind.”
He said: “Appropriate power checks, suit other credit products, are important to prevent people from kicking financially, as it is ensuring that they understand the results of missed payment in financially weak positions.”
Rocio Concha, which? The director of the Policy and Advockey said: “Now buy, pay later, be a really convenient way to spread the cost of goods, but because it is not yet regulated, it has not come without risk for consumers.
“Regulation would mean that the consumer will be subject to affordable investigation to ensure that the credit that they are taking and the risk of falling into the loan to ensure that the credits they are taking.”
