UK Government Launches Consultation to Regulate Buy-Now, Pay-Later Firms Under FCA and Consumer Credit Act

The UK government has launched a consultation on proposals to bring Buy-Now, Pay-Later (BNPL) firms under the supervision of the Financial Conduct Authority (FCA) and apply the Consumer Credit Act. This move comes after significant advocacy from consumer rights experts and financial commentators, including Martin Lewis, who has long called for regulation in this sector. The consultation aims to address the increasing number of people seeking help with BNPL debts, which has tripled over the past year. HM Treasury has outlined plans to protect millions of users through new legislation, ensuring proper affordability checks and leveling the playing field with other forms of debt. The initiative, supported by Rachel Reeves and the Chancellor, is seen as a crucial step in safeguarding consumers and promoting responsible lending practices. The stock of Affirm Holdings Inc. ($AFRM) may be impacted by this regulation.