CFPB to Classify BNPL Loans as Credit Cards Under Consumer Laws

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The Consumer Financial Protection Bureau (CFPB) issued an interpretive rule on May 22, 2024, classifying Buy Now, Pay Later (BNPL) Lenders as credit card providers, requiring some of the key legal protections and rights that apply to conventional credit cards. This new rule issued by the CFPB will address the applicability of subpart B of the Truth in Lending Act (TILA) Reg Z.

Treliant offers expert regulatory compliance consulting services to assist with navigating these regulatory changes by helping implement the design and processes needed to ensure adherence with these regulatory changes.


As inflation rises and prices for basic goods and services increase, individuals and families are looking for alternative methods to fund everyday purchases. One of the more popular, unconventional methods is through BNPL loans. Lenders issuing BNPL loans entered CFPB radar more than two years ago and they have seen a rise in consumer complaints related to refunds and transaction disputes. There has also been a noticeable uptick in BNPL defaults.

As of result of the increased usage and increasing complaints and defaults, BNPL lenders will now be required to extend many of the same rights and protections as credit card providers, based on the most recent interpretive rule set forth by the CFPB on May 22, 2022.

This rule will require BNPL lenders to adhere to the following:

  • Investigate disputes: Buy Now, Pay Later lenders must investigate disputes that consumers initiate. Lenders will be required to pause payments and sometimes issue credits during the investigation.
  • Refund returned products or cancelled services: When consumers return products or cancel services for a refund, BNPL lenders will be required to credit the refunds to the consumers’ accounts.
  • Provide billing statements: Consumers will be required to receive periodic billing statements like ones received for credit card accounts

What This Means for Financial Institutions

The CFPB made this change by issuing an interpretive rule, as opposed to a notice of proposed rulemaking, and these new requirements will apply, without modification, 60 days after it is published in the Federal Register. With heightened scrutiny from the CFPB, as well as the short timeframe for the rule to take effect, lenders are encouraged to review and enhance their compliance programs. Many financial institutions leverage consulting firms, such as Treliant, to assess their regulatory procedures, implement new ones as needed, and ensure their program meets these updated rules.

Regulatory changes happen fast and often. Banks that work with fintechs who extend BNPL loans will be expected to review BNPL compliance programs to ensure they are compliant.

Our team of experts are ready and equipped to help navigate these challenges. Treliant specializes in services such as independent CMS assessments, consumer rule implementation, framework builds, regulatory change management, control design and testing, and more.

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