Buy now, pay later rules finalised – but key protections won't take force until this summer

One in five people used BNPL firms, which are currently unregulated, either in-store or online in the 12 months to May 2024, according to research from the Financial Conduct Authority (FCA). It can be a useful tool, as it allows you to spread the cost of an item over several months interest-free.

But compared to other forms of debt, there are currently very few affordability checks, meaning that too many people can end up with multiple BNPL repayments and damaged credit files. Research by debt help charity StepChange found that BNPL users are also twice as likely as other credit users to borrow to cover essential bills, and it's now as common as using an overdraft amongst UK adults.

This is why we've long been calling for urgent regulation, which has now been cemented by the FCA following a consultation. Firms will need to register with the regulator by 15 July 2026 to continue providing BNPL agreements, and will need to offer key information and protections to consumers.

BNPL regulations confirmed – here's what it means for you

Starting from 15 July 2026, firms will need to be FCA-authorised in order to offer BNPL agreements. This means they'll need to provide the following services to consumers:

• Clear information about the agreement. Including how much your payments will be, when they'll be due, and what happens if you miss a payment.

• "Proportionate" affordability checks for all purchases. Lenders will have to run checks for every purchase; not just when you first open an account. This includes affordability checks when making small payments of less than £50. The FCA has provided guidance on how firms should handle these checks, and has said it will monitor these processes – though firms can still use their own discretion, which means processes may vary by lender.
  
  Citing research from MoneySavingExpert.com (MSE) founder Martin Lewis' charity, the Money and Mental Health Policy Institute, the FCA has previously said that BNPL's "seamless customer journey and lack of friction" can lead to impulse buying and debt for some.

• Notification straight away if you miss a repayment. Firms will need to explain what you owe, the consequence of missing repayments, and how you can remedy the situation. If you're struggling or in financial difficulty, they'll also need to signpost you to free debt help services and consider offering forbearance (for example, giving you longer to repay or waiving fees).

• Powerful Section 75 protection. This applies to items costing over £100 but not more than £30,000, as it does for credit cards currently. It means the BNPL provider will be jointly liable with the retailer if anything goes wrong. This will, however, ONLY apply to new BNPL agreements made from 15 July 2026 onwards – so any purchases made before this date won't be protected.

• Access to the Financial Ombudsman Service for any complaints that arise. If you complain to a BNPL firm and don't get anywhere, you'll be able to escalate your complaint to the independent arbitrator, which can officially determine whether you've been treated fairly. This should make it easier to get a refund if you're entitled to one. As with Section 75, you can only take complaints to the Ombudsman about BNPL agreements entered into on or after 15 July 2026.

Martin Lewis: 'Protections are not fully in place – you should still be careful'

In July 2025, when the FCA outlined its plans for the new rules, Martin shared his reaction:

Martin and MSE have long called for urgent regulation

Martin and MSE, alongside other campaigners, have long called for the "explosive" BNPL market to be regulated. In February 2021, the previous Government announced that regulation would be implemented. However, despite renewed calls for action from Martin and MSE, alongside others, the last Government never put the regulation in place.

To read more about our calls for regulation, see our BNPL Campaigns blog. For more on using BNPL schemes responsibly, see our Buy now, pay later guide.