Group 1 - The UK government will implement comprehensive regulatory upgrades for the Buy Now Pay Later (BNPL) industry starting next year, aligning its standards with other consumer credit products [1] - The new regulations require BNPL lenders to conduct mandatory affordability checks and establish consumer redress mechanisms, ensuring borrowers can complain to the Financial Ombudsman Service in case of disputes [1] - A unified regulatory timeline has been set, with all provisions to take effect by 2026 to ensure a smooth transition for the industry [1] Group 2 - The previous Conservative government began reviewing the BNPL sector in 2021, focusing on major platforms like Klarna, Clearpay, PayPal, and Zilch Technology, which saw increased transaction volumes during the pandemic [2] - The rapid expansion of the BNPL industry has revealed risks, as some consumers accumulate debt across multiple platforms without proper financial planning, while existing regulations only cover traditional credit products [2] - The new regulations are expected to reshape the competitive landscape of the BNPL industry, potentially leading to the exit of smaller firms due to increased compliance costs, while larger companies will need to adjust their risk management systems [2]