'Buy Now, Pay Later' (BNPL) Payment Services: Opportunities and Legal Challenges for EU Consumers and Businesses

The digital revolution is rapidly advancing in a society in which payment and credit services are becoming increasingly indispensable to foster the transition from more traditional services. The payment and credit sectors are expanding swiftly and the range of services they provide attempts to meet a wider spectrum of demands from consumers increasingly shopping online and merchants that are looking to optimise their transactions while attracting more clients. In this context, 'buy now, pay later' (BNPL) represents the hottest novelty in the payment and (short-term) credit market. In this respect, we provide, on the one hand, an analysis of opportunities and risks for consumers, merchants and competitors engaging with BNPL services. On the other hand, through a complete and timely analysis of the relevant European Union (EU) legislation concerning payments and credit systems, we aim to identify whether BNPL firms are subject to an appropriate regulatory perimeter by using the experience of other jurisdictions, such as the United Kingdom, as a reference framework. In this respect, we will assess the extent to which the EU legislator should regulate BNPL services, especially concerning their scope, and how BNPL can fit whithin the existing regulatory perimeter concerning consumer credit and payment services.