Buy now, pay later (BNPL) arrangements have seen a significant rise, especially since they offer interest-free installments and are not bound by traditional consumer financial protection regulations. This growth has attracted the attention of banks and regulators alike. While banks are exploring BNPL products for their potential to increase sales, regulators such as the Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency (OCC) are contemplating stricter oversight due to concerns over consumer protection. Issues under scrutiny include unclear credit disclosures, mandatory use of autopay, dispute resolution, consumer risk management, and data harvesting practices. As the regulatory landscape shifts, BNPL providers must stay informed and adapt to maintain their services as a beneficial option for consumers and merchants.
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