If you’re among the millions of Australians using Buy Now Pay Later (BNPL) services, it’s important to be aware of significant regulatory changes that took effect on 10 June 2025. These reforms are designed to provide stronger consumer protections while preserving the convenience and flexibility that BNPL services offer.

Previously, BNPL arrangements operated outside the scope of the National Consumer Credit Protection Act, meaning consumers were not afforded the same protections that apply to credit cards or personal loans. From 10 June 2025, that has changed.

Under the new framework, all BNPL providers must:

  • Hold an Australian Credit Licence (or have lodged an application by 10 June 2025);
  • Be a member of the Australian Financial Complaints Authority (AFCA);
  • Comply with responsible lending obligations; and
  • Meet broader consumer protection requirements under credit law.

These reforms close previous regulatory gaps and bring BNPL providers in line with other credit providers, offering you greater transparency and accountability when using these services.

The updated rules acknowledge that most BNPL arrangements involve lower risk than traditional forms of credit. As such, BNPL providers will typically operate under the classification of “low cost credit contracts”, with obligations tailored to reflect the specific nature of BNPL services while still safeguarding consumers.

When you apply for a BNPL product or request a credit limit increase, your provider must now:

  • Assess whether the credit offering is suitable for your financial circumstances;
  • Collect and verify information about your income, expenses, and liabilities; and
  • Provide you with a free written copy of the credit assessment, if requested.

These obligations are designed to prevent over commitment and reduce the risk of financial hardship, particularly for vulnerable consumers.

You can verify whether your BNPL provider is properly licensed by using the ASIC Professional Registers available on the Australian Securities and Investments Commission (ASIC) website.

BNPL services continue to offer flexible payment options and support a thriving sector of the economy. These new consumer protections aim to reduce the likelihood of debt spirals and ensure that you, as a consumer, can use BNPL products with greater confidence and security.

If you have concerns about your BNPL provider or need assistance navigating the new regulations, contact us today.

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