Buy Now Pay Later: Key Statistics
According to the Financial Conduct Authority (FCA) and StepChange:
- In the 12 months leading up to May 2024, 1-in-5 (20%) of UK adults (around 10.9 million) had used Buy Now Pay Later (BNPL) at least once – up from 17% (8.8 million) in 2022.
- By 2024, BNPL lending reached approximately £13 billion in the UK.
- BNPL users are twice as likely as other credit users to borrow to cover essential bills.
- BNPL has now become as common as using an overdraft amongst UK adults.
Where Are We at Now?
Buy Now Pay Later (BNPL) is an important credit source for those who can’t afford to pay for items upfront, but since its introduction to the UK market in 2014, Buy Now Pay Later regulations have been limited.
There are currently very few affordability checks, which can cause what you owe to spiral into multiple repayments and negatively affect your credit score if you can’t keep up with them. What started out as convenient borrowing has, in practice, become a risk of impulse buying, unaffordable lending and debt for some customers – especially those with repeat usage.
What Are the New Buy Now Pay Later Regulations?
From 15th July 2026 onwards, BNPL will be subject to the Financial Conduct Authority’s (FCA) ‘Consumer Duty’, which sets the standard of care (e.g. a fair, transparent and customer-focused approach) that companies should give to retail consumers. This means BNPL users will benefit from:
- Clearer Information: Clear, upfront details about the BNPL agreement (i.e. when payments are due, the amounts and what happens if you miss one).
- Affordability Checks: Lenders will be legally obliged to carry out proportionate checks (lenders will have to run checks for every purchase, not just when you first open an account) to make sure customers can afford to repay what they borrow before taking out a BNPL agreement. The FCA will monitor these checks, but companies can still make their own judgements, so processes may vary by lender.
- Section 75 Protection: This means the BNPL provider will be jointly liable with the retailer if anything goes wrong, but will only apply to new BNPL agreements made from 15th July 2026 onwards (any made before this date will not be protected). This covers items that cost over £100 but less than £30,000 (as it does for credit cards currently).
- Support If Necessary: Lenders will also need to offer support to customers in financial difficulty, and direct them to free* debt advice.
- Complaints & Compensation: If something goes wrong, BNPL users will be able to complain to the free Financial Ombudsman Service.
Proceed with Caution
Until 15th July 2026, Buy Now Pay Later regulations will remain limited. We would recommend staying careful until then, or even waiting until then – so if you do encounter a problem, you’ll be better protected and there’ll be more help available to you.
We would recommend doing the following before taking out a BNPL agreement:
- Do Your Research: If you are going to use BNPL, make sure you know exactly what the provider (e.g. Klarna, Clearpay, PayPal) is offering you. Payments are usually automatic on specific dates, which should be made clear to you upfront.
- Look Out for Fees & Charges: BNPL may feel flexible, but it is still a debt. Some providers may charge you interest and fees if you don’t make your repayments on time, which can leave a mark on your credit file.
- Plan Ahead: Only take out an agreement if you know you’ll have the money by the time payments are due. MoneyHelper recommends setting up a direct debit or using your debit card to make repayments, because if you use a credit card, you will still owe money to the card provider.
- Use it Sparingly: If you take out multiple BNPL agreements, you end up juggling several accounts with different repayment deadlines alongside other regular costs and debts. That’s why it’s important to avoid stacking multiple plans at once.
Are You in Buy Now Pay Later Debt?
If you’re behind on your Buy Now Pay Later repayments, you’re not alone. 41% of BNPL users have made at least one late payment in the last year.
A problem shared is a problem halved. Our friendly team of debt advisors are here to listen and help you with no judgement, so please don’t hesitate to contact us and get free*, no-obligation debt advice from our experts. If you need further support, we also offer a range of debt solutions which can support you with getting your finances back on track.
When you reach out for the first time, you don’t have to talk to us on the phone if you don’t want to. Our advisors are also available via email, WhatsApp or webchat.
Alternatively, we offer a free, online debt advice tool which takes less than 15 minutes to fill out and won’t affect your credit score. At the end, you’ll get a tailored budget, advice specific to your situation, and see which debt solutions you may qualify for instantly.
*Our advice is free, but if you sign up for a debt solution, a fee will apply for some solutions.
