Buy now, pay later grows up. Its customers still need to.
On Wednesday, buy now, pay later finally comes under regulation.
I’ve argued for years that it should. And I’m still worried.
Here’s why.
The first time I watched a young woman split a £48 pair of trainers into four payments, she didn’t think she was borrowing. She was shopping “more sensibly,” she told me.
That sentence is the whole story.
From this week, lenders must be authorised, run affordability checks on every purchase, and answer to the Ombudsman when things go wrong. Overdue and welcome — a £13bn market used by one in five UK adults should never have sat outside the rules this long.
But regulation governs how a product is sold. It doesn’t touch whether the person buying it understands what they’ve taken on.
And look at who that person usually is. Roughly two-thirds of frequent BNPL users in Britain are women, most in their late twenties and thirties. Not reckless — default rates sit near 2%, versus around 10% on credit cards. Just financially stretched, using the one flexible, interest-free credit that ever felt built for them.
Fair4All Finance estimates tougher checks could exclude 10–30% of current users. Some shouldn’t have been lent to. But many will carry a very real need for credit through a darker door instead.
Demand doesn’t disappear when you regulate supply. It relocates — usually somewhere with less light on it.
We’ve built a regime that disciplines the lender. We’ve built nothing to equip the borrower.
That’s the gap. And it has no regulator, no deadline, and — so far — no champion.
Wednesday makes BNPL safer to sell. The harder work is making people abler to buy.
Who’s picking that up?
#FinTech #FinancialInclusion #BNPL #FinancialLiteracy
