CFPB to define BNPL providers as credit card providers

The Consumer Financial Protection Bureau issued in May its interpretive rule to address the applicability of subpart B of Regulation Z to lenders that issue digital user accounts used to access credit, including to those lenders that market loans as “Buy Now, Pay Later” (BNPL). 

This interpretive rule describes how these lenders meet the criteria for being “card issuers” for purposes of Regulation Z. Such lenders that extend credit are also “creditors” subject to subpart B of Regulation Z, including those provisions governing periodic statements and billing disputes. As a result, BNPL lenders will be required to provide consumers with options currently available to credit card holders, such as the ability to dispute merchant charges through the creditor. 

While not required under the Administrative Procedure Act, the CFPB is opting to collect comments through Aug. 1, 2024, on this interpretive rule and may make revisions as appropriate after reviewing feedback received.