The Australian Securities and Investments Commission has issued an alert to buy now pay later (BNPL) providers that, following the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Act 2024 receiving Royal Assent, BNPL contracts will be brought into the National Credit Code and providers will need to be licensed. From 10 June 2025, BNPL providers must hold an Australian credit licence authorising them to engage in credit activities as a credit provider, subject to transitional arrangements. To rely on transitional arrangements, a provider must have applied for an appropriate credit licence (or a variation to an existing licence) and have its application accepted for lodgement by ASIC by 10 June 2025, and be a member of the Australian Financial Complaints Authority. ASIC urged providers to act early given lead times for application requirements such as criminal history checks, and flagged 11 May 2025 as the latest date to lodge a complete application to reduce the risk of missing the 10 June 2025 acceptance deadline. Providers continuing to operate without an application accepted by ASIC by 10 June 2025 risk engaging in unlicensed conduct; industry participants are expected to assess the reforms and update systems and processes for compliance. ASIC referred firms to Information Sheet 285 for licensing details. The timing set out assumes no earlier commencement date is fixed by proclamation within the six-month window after Royal Assent. ASIC also noted that some obligations will differ for BNPL contracts that meet the definition of a low cost credit contract, including an ability to elect modified responsible lending obligations, with further regulatory guidance to be released closer to commencement.
Australian Securities & Investments Commission 2025-01-17
Australian Securities and Investments Commission tells buy now pay later providers to seek credit licences under new National Credit Code rules
The Australian Securities and Investments Commission (ASIC) has informed buy now pay later (BNPL) providers that, under the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Act 2024, BNPL contracts will be subject to the National Credit Code, requiring an Australian credit licence by 10 June 2025. Providers must apply and have their application accepted by ASIC by this date to utilize transitional arrangements. ASIC stressed early action due to application lead times and warned of risks for non-compliance. Further guidance will be provided for BNPL contracts defined as low-cost credit contracts.