Get the latest tech news

CFPB Says Buy Now, Pay Later Firms Must Comply With US Credit Card Laws

The Consumer Financial Protection Bureau declared on Wednesday that customers of the burgeoning buy now, pay later industry have the same federal protections as users of credit cards. From a report: The agency unveiled what it called an "interpretive rule" that deemed BNPL lenders essentially the sa...

That means the industry -- currently dominated by fintech firms like Affirm, Klarna and PayPal -- must make refunds for returned products or canceled services, must investigate merchant disputes and pause payments during those probes, and must provide bills with fee disclosures. "Regardless of whether a shopper swipes a credit card or uses Buy Now, Pay Later, they are entitled to important consumer protections under long-standing laws and regulations already on the books," CFPB Director Rohit Chopra said in a release. The CFPB, which last week was handed a crucial victory by the Supreme Court, has pushed hard against the U.S. financial industry, issuing rules that slashed credit card late fees and overdraft penalties.

Get the Android app