Consumer groups welcome new laws regulating Buy Now, Pay Later as credit but some concerns remain

New laws regulating Buy Now, Pay Later (BNPL) have been announced today. Consumer groups respond as follows:

Quotes attributable to Stephanie Tonkin, CEO of Consumer Action Law Centre

“We welcome the Albanese Government’s new laws that regulate Buy Now, Pay Later as credit and introducing consumer protections.

“Every day we speak to people in financial difficulty using Buy Now, Pay Later to buy essentials like food and medicine. People are falling into debt spirals and being harmed by these products.

“So, the requirements for Buy Now Pay Later companies to have effective dispute resolution, fee caps and license conditions similar to other credit providers is progress.

 “However, we do have some concerns about the soft touch approach for smaller BNPL loans under $2000 because of the harm that small multiple accounts are having on people who can’t afford them – we hope this legislation and the regulations to follow, will sufficiently protect these people.”

Quotes attributable to Alexandra Kelly, Director of Casework of Financial Rights Legal Centre:

“Today is a great day for Australian consumers with the Government introducing legislation to at long last treat Buy Now, Pay Later as what it really is – credit. Removing this loophole and bringing Buy Now, Pay Later under the Credit Act will go a long way towards bringing these products within acceptable guardrails and helping people spread their expenses without getting into a debt spiral.”

“We also welcome the fact that the laws will be flexible enough to capture current and developing credit models like wage advance that we are hearing more and more on our phone lines.”

Quotes attributable to Dr Domenique Meyrick, Co-CEO of Financial Counselling Australia (FCA)

“Financial Counselling Australia welcomes this legislation. Financial counsellors witness the harm caused by BNPL every day and this will help reduce that harm.

“As we have said for many years, ‘if it looks like a duck and quacks like a duck then it’s probably a duck.” We are very happy that BNPL will finally be treated as credit’.

“However, we do have some concerns about the weaker requirements for smaller loans because many people have multiple accounts, and we hope this legislation sufficiently protects these people.”

Quotes attributable to Tom Abourizk, Head of Policy at CHOICE

“We welcome the Government’s move to close the legal loophole in the credit law that buy now pay later was designed to exploit. The loophole has allowed the BNPL industry to ignore the financial hardship it has exacerbated for some users.”

“The Government’s Bill will introduce important consumer protections and also empower regulators to identify where BNPL industry practices continue to cause harm.” 



Consumer Action Law Centre, Mark Pearce 0413 299 567
Financial Rights Legal Centre, Drew MacCrae  0404 604 978
CHOICE Media 0430 172 669
Financial Counselling Australia, Maura Angle  0418 334 121

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