Buy Now Pay Later products and consumers

That this House calls on the Government to take urgent action to introduce stronger consumer safeguards on the Buy Now, Pay Later (BNPL) market; understands that BNPL products have become an increasingly popular payment method in the UK, experiencing huge growth during and since the covid-19 pandemic, with a third of UK consumers using this payment method; acknowledges that those products allow consumers to spread the costs of goods and services interest-free, with the option to defer payment for 30 days or in instalments after they have received their purchases; notes that BNPL products are on the Financial Conduct Authority’s regulatory perimeter, with providers relying on a regulatory exemption originally intended to allow businesses to offer ongoing services, such as gym membership; acknowledges that the Financial Conduct Authority’s recent Woolard Review expressed concerns about how BNPL schemes are presented by online retailers, frequently without clear information about late fees, credit checks and how repayments work and, in some instances, used as the default method of payment; believes that BNPL products are marketed and presented as a means of payment rather than a form of credit which encourages consumers to use them without fully understanding the risks; and calls on the Government to introduce proportionate regulation and ensure greater transparency on this method of payment so that consumers fully understand the risks involved.