New regulations for Buy Now Pay Later (BNPL) services are now in effect, requiring lenders to obtain authorization from the Financial Conduct Authority (FCA). This change aims to improve consumer rights, allowing for refunds and independent resolutions for unresolved complaints. However, stricter affordability checks may lead to some consumers being denied access to these services, potentially pushing them towards unregulated alternatives.
The regulations also mandate that borrowers receive clear information about loans and be directed to debt advice if needed. While many debt charities support these changes, concerns remain about the impact on consumers who may struggle to access credit for essential purchases.