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CFPB issues orders seeking info on BNPL
The CFPB Thursday issued a series of orders to buy now pay later (BNPL) companies with the goal of collecting information on the risks and benefits of the service. Companies ordered to submit information include Affirm, Afterpay, Klarna, PayPal, and more.
The CFPB states it is concerned about accumulating debt, regulatory arbitrage, and data harvesting in a consumer credit market already quickly changing with technology and expects BNPL products will set new records for lending this holiday season.
"Buy now, pay later is the new version of the old layaway plan, but with modern, faster twists where the consumer gets the product immediately but gets the debt immediately too," said CFPB Director Rohit Chopra in a statement on the orders.
The CFPB has previously warned consumers about the risks of BNPL products and has stated it will publish aggregated findings on insights learned from its inquiry.
The orders were issued following a letter sent to the CFPB Wednesday by a group of Senators urging for strengthened oversight of BNPL products.