The proposals include requiring lenders to check that people can afford to repay BNPL loans and to offer support if they get into financial difficulty. They form part of the FCA’s commitment to helping consumers navigate their financial lives. BNPL borrowers will also be able to complain to the Financial Ombudsman Service if something goes wrong. The rules would take effect when BNPL comes under the FCA’s remit next year.

Sarah Pritchard, deputy chief executive at the FCA, said: “We have long called for BNPL products to be brought into our remit, so people can benefit from BNPL while being protected.

“Our regulation will help consumers navigate their financial lives, with checks on whether they can afford to repay, support when things go wrong and access to the right information to make informed decisions.

“We’re mainly relying on existing requirements, including the Consumer Duty, rather than proposing to make lots of new rules, supporting growth and allowing firms to innovate.”

FCA’s research on unregulated BNPL found one-in-five (20%) UK adults (10.9 million) had used it at least once in the 12 months to May 2024, up from 17% (8.8 million) in 2022.  

BNPL can provide benefits for consumers by giving them access to affordable credit and offers a convenient way to spread payment for goods and services. But, as with other credit products, there are also risks and potential for harm.

There will be a temporary permissions regime in place. This means firms will need to follow FCA rules and will be able to continue to trade before they’re fully authorised.

The FCA welcomes views from BNPL lenders, consumer groups, the wider industry and other interested parties on its proposals to help shape the final rules. The consultation is open for feedback until 26 September 2025.