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The consumer sector has been calling for appropriate regulation of BNPL for several years and we are pleased that legislation will shortly come into force, providing some protection to customers, particularly those experiencing or at risk of financial difficulty. However, we remain concerned about the false narrative that BNPL is low risk and low harm and so should not have to meet the same consumer protection standards as other forms of credit.

Financial counsellors and community lawyers already see a proliferation of BNPL debts from people experiencing financial hardship in the cost-of-living crisis. For most people with a reliable income that exceeds their everyday living expenses, BNPL may be a better product than a credit card. These customers who would never or rarely default on repayments are not the people calling us. We hear from people using BNPL to afford essentials like groceries, initiating a debt spiral from which it is very hard to recover.

Read the full submission (PDF).