The Financial Conduct Authority (FCA) will enforce new regulations for Buy Now Pay Later (BNPL) schemes starting July 15, 2026, requiring lenders to assess affordability before approving purchases. This marks a major shift in consumer credit oversight.
From this date, all BNPL operators must be FCA-authorised and follow rules on transparent repayment terms, missed payment consequences, and signposting to free debt advice. However, agreements made before July 15 generally do not benefit from these protections, potentially confusing millions of shoppers.
What Changes on July 15, 2026?
The FCA clarifies that Deferred Payment Credit (DPC) – interest-free credit repayable in 12 or fewer instalments over 12 months or less – is currently unregulated. From July 15, 2026, DPC agreements become regulated, meaning lenders must conduct affordability checks and provide clear information. The FCA states: "From 15 July 2026, this will change."
Citizens Advice explains: "With BNPL it's easy to buy what you want and not realise how much you're spending. From 15 July, they'll be regulated by the FCA, so you'll have greater protection. They'll have to check you can afford to repay and point you to free debt advice if needed."
Why the Date Matters for Consumers
Thomas Drury, money saving specialist at The Investors Centre, warns that the date an agreement was made is crucial. He says: "This is one of the biggest changes we've seen for BNPL since these products became mainstream. The new rules should make it much easier for shoppers to understand exactly what they're agreeing to... The important thing to remember, though, is that these protections aren't simply being applied to every existing agreement overnight."
Consumers may mistakenly believe all their BNPL transactions are covered. Drury adds: "Someone could have one purchase made on July 10 and another on July 20 through exactly the same provider. On the surface, they'll look very similar, but the regulatory protections behind those agreements may not be identical."
New Rules Don't Eliminate All Risks
Despite stronger regulation, BNPL remains borrowing. Drury cautions: "The new rules don't make BNPL risk-free. They make it more regulated. You're still borrowing money... One purchase rarely causes difficulties on its own. It's when someone has five or six different repayment plans leaving their account throughout the month that things become much harder to keep track of."
The reforms coincide with the summer sales season, when spending naturally rises. Drury advises treating BNPL like any credit: "Before agreeing to it, ask yourself whether you'd still feel comfortable making every repayment if an unexpected bill arrived next month. The stronger regulation is good news for consumers, but it doesn't replace careful budgeting."
Review Existing BNPL Agreements
Experts recommend checking outstanding BNPL agreements, noting which were made before July 15. Drury says: "Knowing when your repayments leave your account, how much remains to be paid and which agreements were taken out before the rule change can help avoid surprises later."
The FCA's new rules aim to protect consumers, but individual responsibility remains key. As Drury concludes: "The best protection you'll ever have is understanding exactly what you've signed up for before you click 'Pay Later'."
