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CFPB says buy now, pay later firms must comply with U.S. credit card laws

May 22, 2024


The Consumer Financial Protection Bureau declared on Wednesday that customers of the burgeoning buy now, pay later industry must abide by the same federal protections as users of credit cards.

The agency unveiled what it called an “interpretive rule” that deemed BNPL lenders essentially the same as traditional credit card providers under the decades-old Truth in Lending Act.

That means the industry — currently dominated by fintech firms like Affirm, Klarna and PayPal — must make refunds for returned products or canceled services, must investigate merchant disputes and pause payments during those probes, and must provide bills with fee disclosures.

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