Millions of people use Buy Now Pay Later (BNPL) services every year to spread the cost of everyday purchases.
From 15 July 2026, those products are officially regulated by the Financial Conduct Authority (FCA), giving consumers many of the same protections that already apply to credit cards and other regulated borrowing.
The changes apply to Buy Now Pay Later products offered by providers such as Klarna, Clearpay and PayPal, and are designed to make borrowing safer while giving shoppers stronger rights if something goes wrong.
Why the rules have changed
Buy Now Pay Later has grown rapidly over the past few years, becoming a common payment option at online checkouts.
While many people use it responsibly, concerns have grown that some consumers were taking on debt they could not afford, often without fully appreciating that they were entering into a credit agreement.
Unlike other forms of borrowing, most BNPL products previously fell outside FCA regulation, meaning consumers had fewer legal protections if they experienced problems.
The Government announced plans to change this in 2024, legislation followed in 2025, and the new rules are now in force.
What has changed?
The biggest changes include:
- Affordability checks before credit is offered, helping to prevent people borrowing more than they can realistically repay.
- Clearer information explaining that Buy Now Pay Later is a form of credit and how repayments work.
- Stronger refund rights when goods are faulty, bringing BNPL into line with other regulated credit products.
- Access to the Financial Ombudsman Service, allowing consumers to make an independent complaint if they believe a provider has treated them unfairly.
- Greater support for customers in financial difficulty, with firms expected to direct people towards debt advice before pursuing collections.
For most shoppers, using Buy Now Pay Later should feel much the same as before. The main difference is that providers must now meet the same regulatory standards expected across the wider consumer credit market.
What do the new rules mean in practice?
If you apply to use Buy Now Pay Later, your provider may now ask for more information before approving your purchase.
These checks are intended to ensure the repayments are affordable and reduce the risk of people building up unmanageable debt across multiple BNPL agreements.
If something goes wrong later, consumers also have clearer routes to resolve disputes.
For example, if your provider refuses a refund you believe you’re entitled to, or reports incorrect information to your credit file, you can now escalate your complaint to the Financial Ombudsman Service if you cannot resolve it directly.
Should you still use Buy Now Pay Later?
Buy Now Pay Later can still be a useful budgeting tool when used carefully.
However, it remains a form of borrowing. Missing repayments can affect your finances and, depending on the provider and circumstances, may impact your credit record.
Before choosing BNPL, it’s worth asking yourself:
- Can I comfortably afford every repayment?
- Am I already using several Buy Now Pay Later agreements?
- Would paying in full now leave me in a better financial position overall?
Using BNPL occasionally to spread the cost of planned purchases is very different from relying on it to cover everyday spending because money is tight.
A significant step for consumer protection
The new rules represent one of the biggest changes to Buy Now Pay Later since the products first became widely available.
By bringing the sector under FCA regulation, the Government aims to give consumers clearer information, stronger legal rights and better protection if things go wrong, while allowing responsible borrowers to continue using these products with minimal disruption.
For the millions of people who regularly choose Buy Now Pay Later at checkout, the experience should remain familiar—but with important new safeguards now in place.
