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US Buy Now, Pay Later Regulation

How Providers Can Get Ahead of Pending Crackdowns

Report by David Morris  | Feb 28, 2022
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Table of Contents
Executive Summary
BNPL Providers Must Be Proactive About Regulatory Attention
CFPB Inquiry Will Change BNPL Practices and the Competitive Landscape
How BNPL Providers Can Take Cautionary Action
Insider Intelligence Interviews
Read Next
Sources
Media Gallery
About This Report
BNPL providers should prepare now for potential regulatory changes affecting credit reporting, customer creditworthiness, late fees, and more.
Topics
Payments
United States
Table of Contents
Executive Summary
BNPL Providers Must Be Proactive About Regulatory Attention
CFPB Inquiry Will Change BNPL Practices and the Competitive Landscape
How BNPL Providers Can Take Cautionary Action
Insider Intelligence Interviews
Read Next
Sources
Media Gallery

Executive Summary

The Consumer Financial Protection Bureau’s recently launched inquiry into the potential risks of buy now, pay later (BNPL) products could force providers to change their playbooks. By evaluating current services, providers can preemptively identify and address the practices under question—and refocus on competing for share of the skyrocketing BNPL user base.

Key Question: How should BNPL industry participants prepare for regulatory changes?

US Buy Now, Pay Later Users, 2018-2025 (millions and % of population)
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KEY STAT: The number of US BNPL users will soar from 1.6 million in 2018 to 59.3 million in 2022, driven by innovations in credit access and purchase flexibility. Growth will taper through 2025, however, as BNPL enters a post-regulation maturity phase.

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    Table of Contents

    1. Executive Summary
    2. BNPL Providers Must Be Proactive About Regulatory Attention
    3. CFPB Inquiry Will Change BNPL Practices and the Competitive Landscape
    1. How BNPL Providers Can Take Cautionary Action
    2. Insider Intelligence Interviews
    3. Read Next
    1. Sources
    2. Media Gallery

    Charts in This Report

    US Buy Now, Pay Later Users, 2018-2025 (millions and % of population)US Buy Now, Pay Later Users, by Generation, 2022 (millions and % of population in each group)

    Interviewed for This Report

    Chiro Aikat
    Mastercard
    Executive Vice President, Product and Engineering, North America
    Interviewed February 7, 2022
    David Eads
    Vine Financial Inc.
    Co-Founder and CEO
    Interviewed February 1, 2022
    Ted Fifelski
    Know Technologies Inc.
    Co-Founder
    Interviewed February 4, 2022
    Tony Glasby
    PPRO
    Senior Vice President, Banking and Payments Strategy
    Interviewed January 27, 2022
    Paul Paradis
    Sezzle
    President
    Interviewed January 28, 2022
    Jim Van Dyke
    Sontiq, a TransUnion Company
    Senior Vice President, Innovation
    Interviewed January 27, 2022

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    authors

    David Morris

    Contributors

    Daniel Decea
    Researcher, Financial Services
    Jaime Toplin
    Senior Analyst