Buy now pay later exposure draft materials
Our organisations have long advocated for Buy-now-pay-later (BNPL) to be regulated as a credit product under the National Consumer Credit Protection Act 2009 (NCCPA), and so we welcome the major step towards achieving this outcome that the Exposure Draft materials (ED Materials) represent.
We urge the Government to finalise this legislation as a matter of priority to ensure that the framework is passed this year.
We continue to hear from people who have been pushed towards, or deeper into, financial hardship, by unaffordable BNPL debts. For example, as it is currently one of the easiest forms of credit to obtain, BNPL routinely features in the debt mix of victims/survivors of family violence.
Borrowers, financial counsellors and lawyers continue to report difficulties in getting proper hardship responses from even major BNPL companies, which exacerbates the financial and emotional toll that being in debt has on a person. BNPL is causing the same harms as other forms of credit products and needs regulation that provides the same consumer protections.
We welcome the requirement for BNPL providers to hold an Australian Credit Licence, be members of the Australian Financial Complaints Authority (AFCA), comply with hardship obligations and caps on permissible default fees and enabling the extension of the regime to
capture other unregulated credit models, such as wage advance products, in the future.
Read the full submission (PDF).
Joint consumer sub BNPL - April 2024 (1)