FCA finalises new protections for BNPL users from July 2026

Core Viewpoint - The UK's Financial Conduct Authority (FCA) will implement regulatory protections for Buy Now Pay Later (BNPL) customers starting on 15 July 2026, aiming to enhance consumer safeguards in this growing credit sector [1][3]. Group 1: Regulatory Changes - BNPL arrangements will fall under the Consumer Duty, ensuring consumers receive clear information regarding payment dates, amounts due, and consequences of missed payments [1]. - Lenders will be mandated to conduct proportionate affordability assessments to ensure customers can reasonably repay borrowed amounts [2]. - Providers must assist customers facing financial difficulties and direct them to free debt advice services when necessary [2]. Group 2: Consumer Protection - The FCA emphasizes the importance of BNPL as a credit source, noting that regular users currently lack specific regulatory protections, particularly concerning affordability [3]. - The new measures aim to help consumers manage their finances and ensure support is available when issues arise [3]. - Users will have the right to escalate unresolved issues to the Financial Ombudsman Service once the protections are in place [2]. Group 3: Market Insights - The BNPL market, referred to as the deferred payment credit (DPC) market, is valued at over £13 billion (approximately $17.73 billion) [5]. - The FCA's initiative is designed to strengthen consumer protection in this rapidly expanding market by introducing robust affordability checks and clearer disclosures [5]. - With many users already in financial difficulty, it is crucial for customers to fully understand BNPL products and receive appropriate support, especially if they fall behind on payments [6].