Buy Now, Regret Later?
Buy Now, Pay Later Is Finally Being Treated Like Credit — Because It Is
For years, Buy Now, Pay Later (BNPL) services have operated in a bit of a loophole. They walked like credit, talked like credit… but weren’t actually regulated like credit. Which is absolutely crazy!
They’ve been able to bypass the usual standards credit issuers are held to, and that’s allowed them to often masquerade as ‘budgeting services’ instead of what they are — debt, and ‘bad debt’ at that.
That’s now changing — and honestly, it’s about time.
If you’ve ever used Afterpay, Zip, Klarna, or any of the other ‘interest-free’ BNPL options, you’re not alone. They boomed in popularity over the last few years, especially with younger Aussies looking for flexibility. But behind the slick apps and feel-good marketing? They can be pretty dangerous.
Now I’m not anti them — I’ve actually used these services myself, and in a recent blog I talked about how I put my mouth makeover (veneers) on credit and why it worked for me. But what I am anti is them not having the same standards as other credit, like credit cards, personal loans, etc.
But now, the government’s stepping in and the changes are here!
So, what’s changing?
BNPL providers will soon have to follow the same rules as other credit products — including proper credit checks and responsible lending obligations. That means they can’t just hand out thousands in spending limits without checking if you can realistically afford it.
They’ll also need to hold an Australian credit licence (if they don’t already) and meet the same regulatory standards as credit card companies and personal loan providers.
This move is all about consumer protection — making sure people aren’t pushed into financial stress from stacking up multiple BNPL accounts without anyone really looking at the bigger picture.
What does it mean for you?
If you’re already using BNPL, nothing will change overnight. But moving forward, expect:
More thorough application checks
Better safeguards if things go wrong
Less chance of someone being approved who shouldn’t be
This is a good thing. Because while BNPL can be helpful when used wisely, it’s also been linked to late fees, repayment struggles, and debt cycles — especially among people under 30.
My take?
BNPL isn’t evil — it’s a tool. But like any financial tool, it needs guardrails. And for too long, it’s been running without them. If you’re using these services, take a moment to check in:
Are you using BNPL for essentials because you’re short on cash? That’s a red flag.
Do you have multiple accounts on the go? Time to simplify.
Do you actually know when each repayment is due — and do you have the money to cover it?
There’s no shame in using flexibility when it works for you — but don’t mistake ‘interest-free’ for ‘consequence-free.’
Need a reset on your money habits?
Start with my free Financial Health Checklist at www.gemmamitchell.com.au or book a free 15-min call to see how I can support you.
The Money Reset — out August 27. Pre-order your copy here
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Gemma x