New BNPL Rules Take Effect on 15 July as Ecommpay Warns Merchants to Check Checkout Risk

From 15 July 2026, the interest-free instalment model behind most BNPL products comes under full FCA supervision. Ecommpay says merchants should now check whether their BNPL partners are actually ready for the new regime, because a lender’s compliance problem can turn into a checkout problem and, eventually, a brand problem.

1. From “Regulation Day,” BNPL lenders must be FCA-authorised or registered under the Temporary Permissions Regime to keep operating legally. They will also need to run affordability checks on every transaction, with the depth of assessment matched to risk.
2. The new rules remove the current small agreements exemption, so the checks apply even to purchases under £50. Lenders must also give customers clear upfront disclosure of payment dates, amounts, and the consequences of missed payments.
3. A new arrears framework now requires prompt contact, reasonable notice before enforcement, and signposting to free debt advice. Consumers will also be able to take eligible complaints about DPC (Deferred Payment Credit) agreements to the Financial Ombudsman Service.
4. Ecommpay says the rules apply directly to lenders, not merchants, but merchants still need to review who is sitting in their checkout. Using a non-compliant provider may not put the retailer in direct breach of FCA rules, but it can affect checkout performance and expose the merchant’s brand to reputational damage.
5. Alpa Jotangia, Head of Compliance at Ecommpay, said BNPL has always been credit and regulation is simply catching up. Her point is straightforward: customers remember the checkout experience, the refund experience, and what happened when something went wrong, not the legal distinction between lender, payment provider, and retailer.

Ecommpay recommends three checks for merchants with BNPL in the checkout: verify that every provider is FCA-authorised or registered under the Temporary Permissions Regime via the FCA’s Financial Services Register, review what information is shown at checkout and how arrears and refunds are handled, and ask providers how they support compliance, including disclosure, refund handling, and support for vulnerable customers.