Changes Coming for Buy Now Pay Later Services
If you use buy now pay later (BNPL) services, important changes are coming that will strengthen consumer protections from 10 June 2025. New laws will regulate BNPL services more closely, bringing them closer to traditional credit products such as credit cards.
Previously, BNPL providers operated outside the National Consumer Credit Act, which limited consumer protections. Laws passed in late 2024 now close that gap by requiring BNPL providers to meet formal licensing and compliance standards.
What the New BNPL Rules Mean
From 10 June 2025, all BNPL providers must meet stricter regulatory requirements. Providers will need to:
- Hold an Australian credit licence or have applied for one
- Be a member of the Australian Financial Complaints Authority
- Follow responsible lending practices
- Comply with additional consumer protection obligations
These changes aim to ensure BNPL users receive clearer protections when using deferred payment services.
How BNPL Will Be Regulated
The new framework recognises that BNPL services usually carry lower risk than traditional credit products. As a result, most BNPL arrangements will fall under the category of low‑cost credit contracts.
This classification applies modified regulatory requirements that balance consumer protection with the flexibility and convenience that BNPL services offer.
What This Means for Consumers
Stronger regulation will help consumers:
- Better understand their rights and obligations
- Access formal dispute resolution processes
- Receive greater protection from unsuitable or misleading credit arrangements
Consumers will also be able to confirm whether their BNPL provider meets licensing requirements once the new rules take effect.
Why These Changes Matter
BNPL services have become widely used across Australia, particularly for everyday purchases. The updated regulations aim to protect consumers while preserving innovation and competition in the credit market.
By understanding these changes, you can continue using BNPL services with greater confidence and make informed decisions that support your financial wellbeing.
Important: Clients should not act solely on the basis of the material contained here. Items herein are general comments only and do not constitute or convey advice per se. Also, changes in legislation may occur quickly. We, therefore, recommend that our formal advice be sought before acting in any of the areas.
