“The Interpretive Rule released by the Consumer Financial Protection Bureau (CFPB) provides vital clarity for companies offering responsible Buy Now Pay Later (BNPL) products. The Rule recognizes the benefits that responsible BNPL providers offer but more importantly provides consistent industry standards to promote greater choice and transparency for consumers utilizing responsible BNPL products.

As part of its mission to promote affordable, responsible and transparent financial products, AFC developed and adopted specific policy standards for the provision of BNPL products, including classifying products as loans, ensuring transparent terms, underwriting every transaction at the point of sale, providing consumers all disclosures required by the Truth in Lending Act (TILA), and working with credit bureaus to improve reporting standards to create safe pathways out of debt. AFC members offering BNPL loans already voluntarily comply with provisions enumerated by the CFPB and we urge all companies offering BNPL products to embrace responsible industry standards.

We are encouraged by the work the CFPB has done to better understand the buy now, pay later industry. As the 2022 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, and all of our stakeholders to promote innovation that responsibly extends access to credit while ensuring that consumers benefit from consistent standards across BNPL.”