Spreading the cost: changes to Buy-Now Pay-Later rules

Draft legislation before Parliament will remove third-party lenders from the exemption for BNPL regulation. Emma Radmore and Stephen Wilson examine what the changes mean, who they will affect and what happens next.

Emma Radmore (emma.radmore@wbd-uk.com) is legal director in the UK Financial Regulation team at Womble Bond Dickinson. Stephen Wilson (stephen.wilson@wbd-uk.com) is a managing associate with the team. He has 19 years of experience in both non-contentious and contentious regulatory matters, including as a member of the FCA's Enforcement Division and its General Counsel's Division.

Many years after the then Conservative Government announced its commitment to changing how Buy-Now Pay-Later (BNPL) finance, otherwise known as deferred payment credit, is regulated under financial services laws, the current Government has finally put legislation before Parliament to bring the changes into force. Once the new law takes effect, fewer businesses will be able to rely on a popular exemption.