Washington doesn’t buy “buy now, pay later”

Washington is targeting “buy now, pay later” platforms.

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Washington doesn’t buy “buy now, pay later”


The Future. Washington is targeting “buy now, pay later” platforms, looking into how they affect consumer behavior and whether they have the same protections as the credit card industry. With how much these platforms have grown in such a short time, it may be too late to scale them back, but it’s possible that it may soon become harder to qualify for bigger purchases.

Learn now, regulate later
Congress has a bone to pick with “buy now, pay later” (BNPL) platforms like Klarna, Afterpay, and Affirm.

  • The Consumer Financial Protection Bureau is looking into BNPL platforms after the urging of half a dozen lawmakers to review their practices.
  • The lawmakers are chiefly concerned that the platforms encourage overspending and bypass credit and lending regulations.

Right now, the bureau is only requesting information to review but stated that “it is certainly possible that we could as a result of the data collection take enforcement action. We might issue advisories or guidelines, but that’s really premature and sort of putting the cart before the horse.”

Wallet wars
Recently, BNPL platforms have been a major driver of economic activity.

  • They facilitated $97 billion in e-commerce sales in 2020.
  • Major retailers such as Target and Amazon are adopting them and report that it increases purchases by 30-50%.

With BNPL platforms expected to account for 4.2% of global transactions by 2024 (double what it was in 2020), expect calls for regulation to only heat up.


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