Regulation Coming for Buy Now, Pay Later

Britain announces plan to implement consumer protections

Andy Spears
2 min readJun 30, 2022


Photo by Jon Ly on Unsplash

While consumers enjoy the ease and convenience of Buy Now, Pay Later providers such as Klarna and AfterPay, the small loans offered at the point of sale come with certain risks.

In fact, one survey indicated:

32% of Buy Now Pay Later plan users have had to skip paying an essential bill such as rent, utilities or child support in order to make their payments. Even after that, 30% report that they’ve struggled to make their payments.

That may be why the Financial Conduct Authority (FCA) of Britain is moving to implement some key consumer protections.

Reuters reports:

Britain plans to make “buy now, pay later” (BNPL) companies carry out affordability checks, gain approval by the Financial Conduct Authority (FCA) and ensure adverts are fair and clear, the government said on Monday, in measures to regulate the sector.

While regulatory action is in the works in Britain, the U.S. Consumer Financial Protection Bureau (CFPB) has also taken initial steps to regulate the ubiquitous industry:

Lauren Saunders of the National Consumer Law Center (NCLC) says of these products:

Buy-now-pay-later products, if affordable and truly free to the consumer, may help consumers manage larger purchases without the long-term debt and high costs of credit cards. But some BNPL products may have deceptive and abusive profit models built on the expectation of late fees from struggling consumers.

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Andy Spears

Writer and policy advocate living in Nashville, TN —Public Policy Ph.D. — writes on education policy, consumer affairs, and more . . .