The Consumer Financial Protection Bureau (CFPB) has implemented a new interpretive rule to give "buy now, pay later" (BNPL) customers more legal protections, recognizing these lenders as credit card providers. This grants consumers rights such as the ability to dispute charges, demand refunds, and receive billing statements. The Better Business Bureau (BBB) offers several tips for using BNPL services smartly. Despite the appeal of spreading out payments over time, it’s crucial to treat BNPL as a loan. Carefully consider whether the total cost is affordable and ensure that installment payments fit within your budget. Consumers should research both the retailer and the financing company to verify their reputability via BBB.org. Reading the fine print is vital to understanding the terms, interest rates, fees, and policies on late or rescheduled payments. The CFPB’s new ruling mandates that BNPL lenders address disputes, issue refunds, and provide periodic billing statements, boosting consumer protection. As more consumers turn to BNPL plans, knowing your rights and understanding the terms can help avoid unexpected fees and maintain financial health.
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