HM Treasury has published an update confirming it intends to amend its proposed Buy-Now, Pay-Later (BNPL) regulatory regime so that domestic premises suppliers will not need credit broking permissions to offer BNPL products as a payment option. The change follows engagement with industry and the Financial Conduct Authority, which indicated that many small businesses likely to be caught by the original approach have a lower risk profile than traditional domestic premises suppliers and could stop offering BNPL rather than incur the cost and time of seeking permissions, potentially reducing consumer choice and pushing some consumers towards more expensive interest-bearing credit. HM Treasury therefore plans to lay an amending negative statutory instrument to remove the permission requirement, while keeping core consumer protections including lender affordability and creditworthiness checks, access to section 75 Consumer Credit Act protections and the Financial Ombudsman Service, and (once authorised) expectations on BNPL lenders to comply with the FCA’s Consumer Duty and exercise greater oversight of merchants using their services. The government expects the exemption to be in place to coincide with the regulation of BNPL, and it and the FCA will continue monitoring the market and take action if evidence of consumer harm emerges.
HM Treasury 2025-06-16
HM Treasury to exempt domestic premises suppliers from credit broking permissions when offering BNPL payment options
HM Treasury will amend its proposed Buy-Now, Pay-Later (BNPL) regulatory regime to exempt domestic premises suppliers from needing credit broking permissions. This decision follows industry feedback and aims to prevent small businesses from ceasing BNPL offerings due to regulatory burdens, while maintaining consumer protections. The government and the Financial Conduct Authority will continue to monitor the market for potential consumer harm.