The initiative aims to save consumers around GBP 40 – GBP 60 million per year. The rules for the disclosure measures will come into force on 12 September 2019, while the partial repayment rule will come into effect on 12 November 2019.
At the moment, consumers who repay part of the outstanding balance during the BNPL offer period can be charged interest on the full credit amount, including the repaid portion, backdated to the date of purchase. Typically, over a third of consumers do not repay the full balance within the offer period.
Under the new rules, companies will be banned from charging interest on money that has been repaid during that period. Moreover, companies offering BNPL credit will also have to give customers better information about the risks of BNPL deals as well as the benefits and remind customers when the offer period is about to end.
Every day we send out a free e-mail with the most important headlines of the last 24 hours.
Subscribe now