The Australian Government has released draft legislation targeting the regulation of Buy Now, Pay Later (BNPL) products, proposing to bring them under the National Consumer Credit Protection Act 2009 and National Credit Code. This move aims to address issues like unaffordable lending, excessive fees, and insufficient transparency. The proposed laws would require BNPL providers to hold an Australian credit license, adhere to modified responsible lending obligations, and enforce policies for assessing consumer suitability. This development signifies a major shift for the BNPL industry, historically exempt from credit regulations, and aligns with similar regulatory actions in New Zealand. Stakeholders are invited to provide feedback on the draft until 9 April 2024, with implementation expected later in the year.
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