CFPB and Biden Administration Mandate Klarna, Affirm, and Other BNPL Lenders to Follow Credit Card Laws

May 22, 2024, 01:36 PM

The U.S. Consumer Financial Protection Bureau (CFPB) announced that Buy Now, Pay Later (BNPL) lenders must comply with U.S. credit card laws. This new rule ensures that BNPL companies, including Klarna, Affirm, and PayPal, provide consumers with the same legal protections as traditional credit card users. These protections include the right to dispute charges and demand refunds for returned products. The move, supported by the Biden administration, aims to regulate the largely unregulated BNPL market and improve consumer protections under the Truth in Lending Act. The rule follows more than two years of studying the BNPL market.