- Buy Now Pay Later schemes come under FCA Regulation from 15th July 2026
- Businesses should review the impact of the new regulations says leading accountancy firm Price Bailey, as tighter customer checks and compliance requirements threaten to lengthen the checkout process and increase costs.
Buy Now Pay Later products now come under full Financial Conduct Authority regulation as of 15th July 2026, and Price Bailey is encouraging businesses that offer or rely on Buy Now Pay Later to review how the new regime may affect their payment processes and customer journeys.
The regime marks the first time the FCA has brought Deferred Payment Credit within regulation. It covers interest-free credit repayable in 12 or fewer instalments over 12 months or less and third-party lending providers will also need FCA authorisation or temporary permissions.
While the rules primarily affect Buy Now Pay Later providers, businesses that offer Buy Now Pay Later through third-party lenders may also notice practical changes. Additional customer checks and regulatory requirements could lengthen checkout journeys and increase compliance costs for providers, with potential knock-on effects for merchants that rely on Buy Now Pay Later as a payment option.
The changes mark a significant shift for a market that has expanded rapidly, from £60 million in transaction value in 2017 to more than £13 billion in 2024. According to the FCA, around 11 million UK consumers now use Buy Now Pay Later products. From 15 July, customers will also gain access to the Financial Ombudsman Service, and providers will need to carry out proportionate affordability checks, including on purchases below £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 advises businesses that offer deferred payment options, or rely on third-party Buy Now Pay Later providers, to review their arrangements now, and seek advice where there is uncertainty over whether the new FCA regime affects their business or creates additional compliance obligations.
Find more information on the Price Bailey website.
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