CFPB says buy now, pay later firms must comply with U.S. credit card laws

The Consumer Financial Protection Bureau declared on Wednesday that customers of the burgeoning buy now, pay later industry must abide by the same federal protections as users of credit cards.

The use of digital installment loan-type services has ballooned in recent years, with volumes surging tenfold from 2019 to 2021, Chopra said during a media briefing. Among CFPB concerns are that some users are given While the CFPB acknowledged that many BNPL players offer those services, the new rule will ensure that they are applied consistently across the industry, a senior agency official told reporters.

"Instead of trying to jam BNPL into an outdated credit card framework that does little to actually protect consumers, leaders in Washington should draft and implement a framework for BNPL that is proportionate to the risk it poses," Klarna said at the time.

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