Martin Lewis frustrated at slow pace of buy now, pay later rules

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The consumer champion Martin Lewis has criticised the “painfully slow” pace of progress on regulating the buy now, pay later industry, amid indications that promised tougher rules are unlikely to take effect until 2024.

Buy now, pay later (BNPL) lets shoppers delay payment for products such as clothes and furniture. This form of credit enjoyed explosive growth during the pandemic, particularly among under-30s and those with tight finances.

But there has been growing concern among regulators, politicians and consumer groups about how easy it is for people to buy more than they can afford and potentially build up sizeable debts. This month the charity Citizens Advice said shoppers were “piling borrowing on top of borrowing, and sinking into ever more desperate situations”.

In February 2021, the government announced that the Financial Conduct Authority would be given powers to police the multibillion-pound sector, which in the UK is dominated by firms such as Klarna, Clearpay and Laybuy. This will give consumers greater protection and more rights – for example, all firms will have to conduct proper affordability checks before lending, and ensure that customers are treated fairly if they are struggling to repay.

The government on Monday provided an update on the planned new rules, but some commentators voiced frustration at the apparently lengthy timetable for the reforms.

The Treasury said the government would publish a consultation on draft legislation “towards the end of this year”, and would aim to lay secondary legislation before parliament by mid-2023.

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After that, the FCA will have to consult on its rules for the sector, prompting one industry insider to say: “We are probably not going to see anything in law until 2024.” It is thought the government accepts that early 2024 may be more realistic than 2023.

The Treasury indicated that the timetable for the reforms was due to the “complexity” of the regulations. Ministers also intend to expand the rules to cover other forms of unsecured short-term credit, such as those used to pay for dental work.

In response to the announcement, Martin Lewis, founder of, said: “The pace of progress is painfully slow. Buy now, pay later regulation is desperately needed, so my pleasure that it’s finally to happen is tempered by frustration at how long it is taking.”

He said it was now almost two years since his organisation raised the alarm about BNPL’s rapid growth and called for urgent regulation. “Yet those protections still won’t be in place for the financially bleak winter coming.”

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Gary Rohloff, co-founder and managing director of BNPL firm Laybuy, said it was supportive of the government’s approach and would work closely with the FCA on the next steps. “We have always been in favour of a proportionate model of regulation, one that reflects the low risk of BNPL, supports small e-commerce businesses and sets high standards across the industry,” he said.

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