FTA BNPL companies welcome guidance for the rest of the industry to provide the same robust consumer protections
WASHINGTON, D.C. – The Financial Technology Association, a trade group representing leading financial technology companies, today released a statement on the Consumer Financial Protection Bureau’s interpretive rule regarding Buy Now Pay Later (BNPL) products:
“FTA member companies are committed to strong consumer protections, including for disputes and refunds, and agree these protections should be applied consistently across the industry and to those companies claiming to offer Buy Now Pay Later-like services,” said Penny Lee, President and CEO of the Financial Technology Association. “BNPL products are fundamentally different from credit cards: these products have zero interest on outstanding balances, no ability to revolve a balance, and a profit model centered on user success. We look forward to providing additional comments to the CFPB and distinguishing BNPL from products whose business models rely on revolving debt and high consumer fees.”
FTA member companies Afterpay, Klarna, PayPal, and Zip are committed to industry best practices that prioritize consumer well-being and success. That includes clear and transparent terms and conditions, a transparent and consumer-friendly returns and refund process that follows merchant policies, and capped late fees. According to the Financial Health Network, 99 percent of BNPL consumers understand the terms and conditions of BNPL providers. Consumers are using Buy Now Pay Later responsibly and paying back in full and on time. FTA’s BNPL companies report less than a 2% delinquency rate, compared to nearly 9% for credit cards.
To learn more, read Just the Facts on Buy Now Pay Later.
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The Financial Technology Association (FTA) is a Washington, DC-based trade association representing industry leaders shaping the future of finance. We champion the power of technology-centered financial services and advocate for the modernization of financial regulation to support inclusion and responsible innovation.