New York Sets New Guidelines for Buy Now, Pay Later Providers

 The state of New York has unveiled proposed regulations aimed at safeguarding consumers who use Buy Now, Pay Later (BNPL) services. Governor Kathy Hochul has introduced these rules under the FY26 Budget, aiming to establish a licensing and oversight structure for BNPL lenders. The initiative focuses on protecting consumers through obligatory disclosures, dispute resolution protocols, fee limitations, and data privacy policies.

Governor Hochul emphasized the need for these regulations, citing concerns over excessive fees and complex terms in BNPL products. The new rules are designed to ensure transparency and prevent consumers from falling into debt traps while large financial institutions benefit unjustly.

The proposed regulations include prohibiting excessive charges, setting limits on late and penalty fees, and stipulating clear communication about credit reporting. Additionally, standards for resolving consumer disputes efficiently and guarding consumer data against misuse have been established. These rules are set to be adopted after a 10-day preproposal comment period and a subsequent 60-day public commentary phase. The new law will be effective 180 days post-adoption, with a transition period for current BNPL providers in New York, including Block (XYZ, Financial).

https://www.gurufocus.com/news/8643397/new-york-sets-new-guidelines-for-buy-now-pay-later-providers-including-xyz