On Mar. 24, AST ARCA issued requirements for buy now pay later regs.
AST ARCA issued key requirements for upcoming buy now pay later (BNPL) regulation.
Follows AST ASIC guided on requirements for BNPL providers, see #240540.
Outline of Requirements
New BNPL legislation will take effect on Jun. 10, 2025, bringing significant regulatory changes, reforms will align providers with obligations applied to banks, other lenders.
Key changes include licensing by AST ASIC and stricter credit reporting obligations.
BNPL providers offering facilities over AUD 2k must participate in credit reporting at minimum partial level; in addition, BNPL providers are obligated to sign the Principles of reciprocity and data exchange (PRDE) governing industry data sharing.
Companies need to engage with credit reporting bodies (CRBs) to ensure systems are in place for effective data management; AST ARCA recommends comprehensive credit reporting (CCR) vs minimum compliance with negative reporting for AUD 2k, below.
In addition to partial for accounts over AUD 2k; the BNPL providers must educate customers that BNPL is a form of credit that can subsequently affect credit history.
Companies must establish processes for managing customers with financial hardship, ensuring compliance with National credit code obligations, AST ASIC's expectations.
As PRDE signatories, BNPL providers will need processes to report defaults for very overdue accounts; AST ARCA is consulting on the legislation, can help with navigation.
