Fintech
Fintech Nexus Newsletter (May 22, 2024): CFPB Proposes New Rules for BNPL
It’s been a busy last few days for the CFPB and its fintech work. For the third day in a row this week, our top story is about actions taken by the CFPB.
This time it’s BNPL. The CFPB is proposing new rules that would essentially lump BNPL into credit cards when it comes to consumer protection.
Director Chopra has taken a keen interest in BNPL since becoming the leader of the CFPB. So we knew something like this was going to happen, but we didn’t know what form it would take.
Basically, the CFPB is saying that BNPL providers must adhere to the Truth in Lending Act of 1968 the same way credit card companies do. This means information on fees and standard practices for handling disputes and issuing refunds.
Most major BNPL providers already have procedures for this type of thing, but the CFPB says they need to be uniform across the industry.
This is an “interpretive rule”, so no new regulatory requirements are proposed. The agency will seek comment until Aug. 1.
In the foreground
> CFPB says buy now, pay later businesses must comply with U.S. credit card laws
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Peter Renton is president and co-founder of Fintech Nexus, the world’s largest digital media company focused on fintech. Peter has been writing about fintech since 2010 and is the author and creator of the Individual fintech podcastthe first and longest running fintech interview series.