BNPL Lenders Face New Regulations on Refunds Starting Wednesday

New regulations for Buy Now Pay Later (BNPL) services require lenders to obtain regulatory approval to operate, effective Wednesday. This change aims to enhance consumer rights by providing better access to refunds and complaint resolutions. However, it is anticipated that affordability checks could lead to loan rejections for some customers, with concerns about being pushed towards unregulated alternatives. According to Experian, over 100 million BNPL transactions were conducted by 8.5 million customers in 2025, totaling more than £7 billion in spending, with 98.5% of balances repaid on time. This could impact consumer spending and the operational landscape for BNPL providers.