Popular “buy now, pay later” shopping services like Klarna will face stricter regulation under proposals announced by the U.K. government Tuesday. From a report: The Treasury said buy now, pay later (BNPL) firms would come under the supervision of the Financial Conduct Authority (FCA), which regulates financial services firms and markets in Britain. Such firms will be required to conduct affordability checks before lending to customers, the government said, while people will also be allowed to escalate complaints to the U.K.’s financial ombudsman. BNPL products are used as an alternative to credit cards and have exploded in popularity during the coronavirus pandemic, as people turned to online shopping due to lockdown restrictions. Popularized by the Swedish start-up Klarna, these services let customers spread out the cost of their purchases over a period of interest-free instalments. Other companies in the space include Australia’s Afterpay, which operates the Clearpay brand in the U.K., and Laybuy.
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https://news.slashdot.org/story/21/02/02/1436204/britain-is-cracking-down-on-the-37-billion-buy-now-pay-later-industry?utm_source=rss1.0mainlinkanon&utm_medium=feed