WASHINGTON, DC (September 15, 2022) – As part of its mission to promote affordable, responsible and transparent financial products, the members of the American Fintech Council (AFC) have adopted specific policy standards for the provision of Buy Now Pay Later (BNPL) products. AFC member companies that offer BNPL products, like Affirm, adhere to these standards, which reflect many of the issues raised by the Consumer Financial Protection Bureau’s (CFPB) report.

We believe consumers can continue to confidently use BNPL products as a transparent and flexible alternative to other legacy credit products. We have also discussed this in a May 2022 op-ed on BNPL. As the CFPB report concluded, we believe that clear guidelines and consistent industry practices can help ensure that consumers continue to have choice and flexibility when it comes to their payment options. We look forward to continuing to work with the CFPB, members of Congress, consumer advocacy groups, and all of our stakeholders to promote innovation that responsibly extends access to credit while ensuring that consumers benefit from consistent standards across BNPL. ‍

American Fintech Council BNPL Policy Standards‍

BNPL are financial products with 0% interest and repaid in four installments or less; such BNPL is responsible when:

1. It’s deemed a loan, so consumers receive TILA disclosures clearly stating APR.
2. It’s underwritten and ability to repay ascertained.
3. If late fees are applied, they are fully disclosed and do not exceed 36% APR.
4. The business pledges to work with credit bureaus to avoid harming consumer credit scores and improve reporting, since BNPL can appear as multiple trade lines.