For Immediate Release:
May 14, 2025
Contact:
Robert Mayo | hello@woodstockinst.org
CHICAGO – In response to the rollback of enforcement of “Buy Now, Pay Later” consumer protections that required these services to be treated like credit cards and required clear and standardized disclosures, Horacio Méndez, President & CEO of Woodstock Institute, issued the following statement:
“The decision by the Consumer Financial Protection Bureau (CFPB) to halt the enforcement of a rule that classified ‘Buy Now, Pay Later’ (BNPL) services as credit under the Truth in Lending Act (TILA) is a dangerous step backward for consumer protection.
“BNPL services, though convenient, can lead to excessive consumer debt, just as other loan products can. The 2024 rule aimed to impose safeguards, like standardized disclosures and formal dispute investigations, to ensure consumers are fully informed and protected and that all providers are abiding by the same rules of the road. As Federal Reserve Board Chairman Jay Powell has stated repeatedly, like products require like regulations. The rule enjoyed support from both consumer groups and responsible industry actors. When a regulator is stepping back from a rule that was supported by those strange bedfellows, you know something is seriously wrong.
“By removing these protections, the CFPB is exposing consumers to confusion, inconsistent policies and practices between BNPL providers, and even predatory lending practices. This is especially concerning as BNPL use for essential items like groceries is increasing in an economy marked by financial uncertainty.”
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Woodstock Institute is a leading policy and research nonprofit that advocates for consumer financial protection and community economic development. Our work seeks to combat structural inequities and to improve the quality of life in lower-income neighborhoods and communities of color. Among our areas of focus are predatory lending, access to banking, debt collection, and municipal fines and fees.
