- Effective 15th July 2026, Buy Now Pay Later schemes fall under FCA regulation.
- Leading accountancy firm Price Bailey, warns that tighter customer checks and compliance demands could slow down the checkout process and raise costs, and urges businesses to assess the impact of the new rules.
As of 15th July 2026, Buy Now Pay Later products are fully regulated by the Financial Conduct Authority. Price Bailey is urging businesses that provide or depend on BNPL to examine how the updated framework could affect their payment workflows and customer experience.
This regulatory framework represents the first time the FCA has brought Deferred Payment Credit under its oversight. It covers interest-free credit repaid in up to 12 instalments over no more than 12 months. Third-party lending providers must also obtain FCA authorisation or hold temporary permissions.
Although the regulations chiefly impact BNPL providers, merchants that make BNPL available via third-party lenders may also see operational differences. Extra customer verification steps and compliance burdens could extend the checkout process and drive up costs for providers, which in turn could affect retailers that depend on BNPL as a payment method.
These changes mark a major turning point for a market that has expanded rapidly, from £60 million in transaction value in 2017 to more than £13 billion in 2024. The FCA reports that roughly 11 million UK consumers currently use BNPL products. Starting 15 July, consumers will also have recourse to the Financial Ombudsman Service, and providers must conduct appropriate affordability assessments, even for purchases under £50.
Adam Norman, Audit Partner and retail specialist at Price Bailey, remarked: "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 providing deferred payment options or depending on third-party BNPL services should examine their current arrangements without delay, and seek advice if there is any doubt about whether the new FCA regime applies to their operations or imposes extra compliance duties.
Further details are available on the Price Bailey website.
Price Bailey
Eleanor Lodge
eleanor.lodge@pricebailey.co.uk
London
United Kingdom
