Fintech Groups Urge CFPB to Delay Implementation of BNPL Interpretive Rule

The American Fintech Council ("AFC") and Financial Technology Association ("FTA") requested extensions to the effective date set for the CFPB's Interpretive Rule on Buy Now, Pay Later loans ("BNPL"). (See previous coverage.)

In separate comments (see here and here), the AFC and FTA emphasized that the Interpretive Rule includes complex requirements for BNPL vendors who require more time to come into full compliance with Truth in Lending Act ("Regulation Z") requirements. The AFC emphasized that more time is needed for BNPL vendors to "test and responsibly implement necessary changes before civil liability attaches to these additional requirements." The AFC also highlighted the lack of any CFPB published guidance and cautioned that the "Bureau's Interpretive Rule establishes specific requirements for BNPL lenders that were not previously identified through a notice and comment period or other formal rulemaking process."

The FTA highlighted that "the Interpretive Rule raises complex issues regarding regulatory requirements that were designed for credit cards and other traditional open-end products." The FTA said, "the determination that providers of 'digital user accounts' are card issuers has broader implications for other products offered and provided by these entities, beyond the BNPL products at issue."  

The AFC requested that the effective date be extended from July 30, 2024, to January 1, 2025. The FTA requested a 60-day extension of the effective date and requested a 30-day extension of time to provide additional comments.