In advance of buy-now pay-later agreements being brought into the regulatory perimeter, the FCA has written to BNPL providers (both authorised and unauthorised firms) calling on them to consider carefully how they market their products.

In its "Dear CEO" letter, the FCA reminds:

  • authorised firms that they must comply with the requirements in CONC 3 regarding financial promotions, and
  • unauthorised firms that they must obtain approval for their promotions.

If the FCA identifies non-compliant financial promotions, or becomes aware of financial promotions that have not been approved by an authorised firm, it will consider using its enforcement powers (including issuing fines or withdrawing permissions).

The FCA has also written to the British Retail Consortium explaining that, although a lender or merchant promoting unregulated BNPL agreements does not need to be authorised by the FCA, the financial promotions of those agreements do fall within the FCA's jurisdiction and must still meet certain regulatory requirements.

The letters are a response to FCA concerns about financial promotions on websites and social media, including posts by social media influencers, which may breach financial promotion requirements by failing to be balanced.