The CFPB Thursday announced it will conduct supervisory examinations of buy now, pay later (BNPL) companies and bring them in line with consumer protection laws, providing credit unions with a more certain regulatory environment around BNPL. Earlier this year, NAFCU wrote to the CFPB in response to its inquiry into providers of BNPL products, urging the CFPB to “take steps to ensure that these unregulated lenders institute adequate consumer protection practices.”
Through the announcement, the bureau stated they will use interpretive guidance or rulemaking to ensure that BNPL companies are in compliance with the same consumer protection laws as credit card companies. The bureau also added that it will monitor and enforce adherence to those laws through supervisory examinations.
The announcement coincides with the release of the CFPB’s new report on the BNPL market, which came to several conclusions that mirror concerns NAFCU laid out in its comment letter. The report found that:
- borrowers seeking BNPL credit may encounter products that do not offer protections that are standard elsewhere in the consumer financial marketplace;
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