Forvis Mazars comments on the FCA’s Buy Now Pay Later announcement

Christos Doumas, Director | Banking & Capital Markets Advisory & Consulting at Forvis Mazars comments: “The FCA’s announcement is aimed at strengthening consumer protection in a rapidly expanding DPC market, now worth over £13bn. By introducing more robust affordability and creditworthiness checks, clearer disclosures and consistent fair treatment standards, the regulator is seeking to address the risk of consumers taking on multiple agreements without adequate safeguards.

“With many users already in financial difficulty and more households facing pressure from inflation, slower growth, and rising unemployment, it is essential that customers fully understand these products and receive appropriate support, particularly if they fall behind on payments.

“For firms offering DPC products, preparation needs to start now. Businesses coming under FCA supervision will need to ensure they are ready for authorisation, compliant with the Consumer Duty, and aligned to the new regulatory requirements from day one. This will require well-structured change programmes, timely updates to systems and processes, comprehensive documentation, and rigorous testing. Senior management teams must be confident they can evidence compliance and demonstrate that good consumer outcomes are embedded throughout the product lifecycle.

“While the new framework raises the compliance bar, it also presents an opportunity for firms to build greater trust, enhance governance, and differentiate themselves in a market that will now face much closer scrutiny.”