- Starting 15th July 2026, Buy Now Pay Later schemes fall under FCA regulation.
- Leading accountancy firm Price Bailey, warns that businesses must assess the effect of these new rules, as stricter customer checks and compliance demands risk slowing down checkout processes and driving up expenses.
As of 15th July 2026, Buy Now Pay Later products are now fully regulated by the Financial Conduct Authority. Price Bailey is urging any business that provides or depends on Buy Now Pay Later to examine how this new framework might impact their payment systems and customer experience.
This regulatory framework represents the first instance of the FCA overseeing Deferred Payment Credit. It applies to interest-free credit repaid in 12 or fewer installments over a maximum of 12 months, and third-party lending firms will require FCA authorisation or temporary permissions.
Although the regulations chiefly target Buy Now Pay Later providers, companies that make Buy Now Pay Later available through external lenders may also encounter operational shifts. Extra customer verification and compliance obligations could extend checkout times and raise costs for providers, potentially affecting merchants that rely on Buy Now Pay Later as a payment method.
These developments signal a major transformation for a market that has grown swiftly—from £60 million in transaction value in 2017 to over £13 billion in 2024. The FCA reports that roughly 11 million UK consumers currently use Buy Now Pay Later products. From 15 July, customers will also have recourse to the Financial Ombudsman Service, and providers must perform proportionate affordability checks, even on purchases under £50.
Adam Norman, Audit Partner and retail specialist at Price Bailey, comments: "BNPL has grown quickly, but many businesses still see it as a simple payment option rather than a regulated credit product and that assumption is now much riskier. Some businesses will need to look carefully at whether their arrangements bring them into scope, particularly where they offer payment plans directly."
Price Bailey recommends that businesses offering deferred payment options or depending on third-party Buy Now Pay Later providers review their current setups without delay and seek guidance if they are unsure whether the new FCA rules affect their operations or impose additional compliance duties.
Find more information on the Price Bailey website.
Price Bailey
Eleanor Lodge
eleanor.lodge@pricebailey.co.uk
London
United Kingdom
