The Financial Conduct Authority (“FCA”) has confirmed that Deferred Payment Credit (commonly known as “buy now, pay later” (“BNPL”)) will fall within their regulation with effect from 15 July 2026.

 

They indicate that consumers will benefit from:

 

• Clear information: Consumers will get clear, upfront details about their agreement, including when payments will be due, amounts, and what happens if they miss a payment;

 

• Affordability checks: Lenders must carry out proportionate checks to make sure customers can afford to repay what they borrow before offering BNPL;

 

• Support when needed: Lenders will need to offer support to customers in financial difficulty, and, where appropriate, direct them to free debt advice; and

 

• Complaints and compensation: If something goes wrong, consumers will be able to complain to the Financial Ombudsman Service.

 

The FCA has published Policy Statement 26/1 – Regulation of Deferred Payment Credit (unregulated Buy Now Pay Later) and the new rules seek to ensure that consumers are:

 

• Given information that equips them to understand the potential risks, their obligations, rights and protections under a deferred payment credit (DPC) agreement;

 

• Able to borrow sustainably and affordably, miss fewer repayments and consequently be charged fewer late fees; and

 

• Given appropriate support if they are approaching, or are in, financial difficulty.

 

Firms undertaking BNPL activity that do not currently hold the necessary consumer credit permissions will need to register for the Temporary Permissions Regime from 15 May 2026, in advance of the changes coming fully into force on 15 July 2026.

 

Note that these changes solely amend entities which are subject to FCA regulation.  The final rules make no amendment to Chapter 3 of the FCA Supervision Handbook or the FCA Client Assets Handbook.