ao link
0 £0.00
This item was added to your basket
Credit Strategy homepage
LinkedIn
Twitter
Intelligence, Insight and community for responsible professionals in credit

MPs fail in bid to bring buy-now pay-later under regulation

An attempt by a cross-party group of 70 MPs to get buy-now pay-later providers regulated in three months, has failed.

Stella Creasy, the MP for Walthamstow who previously campaigned for tougher regulation on payday loans, was leading the group, using the hashtag ‘stop the #klarnage’, and joining campaigners such as Martin Lewis of MoneySavingExpert and Alice Tapper of Go Fund Yourself.

 

In a statement she highlighted that one in four consumers used buy-now pay-later (BNPL) services during Christmas.

 

The group of MPs had hoped to table amendments to the financial services bill that would force the Treasury to introduce regulations within three months of the bill being passed. But last week parliament voted down the amendment.

 

Tweeting her reaction, Creasy said: "The government voted down our call to regulate BNPL companies - a quarter of their customers have had to ask family or friends to pay back money, 1 in 10 are left struggling to pay rent. Ask your MP if they missed this chance to stop the next Wonga."

 

This is not the first call for regulation of these firms, such as Klarna and ClearPay. In December 2020, Which? called for regulation after its research found “concerning” industry practices, such as encouraging consumers to spend more money than they had planned.

 

Creasy said: “Buy-now-pay-later companies are not regulated like other forms of credit, meaning they don’t have to provide the same information to consumers about costs or make the same assessments about whether they can afford goods.

 

“It took too long for the government to respond to concerns about payday lenders like Wonga, which lead millions getting into debt with them.”

 

Last year, the FCA launched a probe into the creditworthiness checks among such firms.

 

Please login to continue reading this article.

Not a member?

Become a member

FREE registration. No credit card required

Register now
  • Stay up-to-date with industry news and appointments
  • Hear about events first
  • Read 1 free Premium article per month

Become a premium member

From as little as £3.48 per week

Become Premium
  • All the perks of a standard member plus:
  • Access to the entire Credit Strategy website
  • 12 months subscription to Credit Strategy Magazine
  • 25% discount to all conferences
  • Exclusive access to Premium Member only roundtables
  • 50% off award entry fees

GET THE LATEST INDUSTRY NEWS STRAIGHT TO YOUR INBOX

READ NEXT

Over half a million businesses facing “financial distress”

Over half a million businesses facing “financial distress”

Amigo delays release of latest results

Amigo delays release of latest results

FCA to streamline its decision-making processes

FCA to streamline its decision-making processes

Upcoming events

Women in Credit Awards 2021

Car Finance Autumn Conference

Car Finance Awards 2021

Credit Strategy
LinkedIn page

Member of

Did you find our website useful?

Thank you for your input

Thank you for your feedback

creditstrategy.co.uk – an online news and information service for the UK’s commercial and consumer credit industry. creditstrategy.co.uk is published by Shard Financial Media Limited, registered in England & Wales as 5481132, Axe & Bottle Court, 70 Newcomen St, London, SE1 1YT. All rights reserved. Credit Strategy is committed to diversity in the workplace. @ Copyright Shard Media Group