Buy Now Pay Later rules to bring refunds and rejections

UK · 2026-07-14

1. Step 1 · The triggerUK government mandates FCA approval for BNPL lenders, imposing compliance costs and affordability checks.
2. Step 2 · Knock-onKlarna and Clearpay tighten credit criteria, reducing approval rates and transaction volumes for merchants.
3. Step 3 · Reaches youSMEs using BNPL at checkout see lower conversion rates but reduced bad-debt exposure, shifting payment mix toward debit/credit cards.

The trigger is reported by the source below. The steps that follow are Branch²’s traced reasoning — how the shock could reach a business like yours, not a prediction.

Source: BBC News — Business

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