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UK cost-of-living crisis prompts warning to 'buy now, pay later' lenders

By Huw Jones LONDON (Reuters) - Britain's financial watchdog has told firms offering 'buy now, pay later' loans to spell out the cost of late repayments to customers as the UK...
UK cost-of-living crisis prompts warning to 'buy now, pay later' lenders © Reuters. FILE PHOTO: Signage is seen for the FCA (Financial Conduct Authority), the UK's financial regulatory body, at their head offices in London, Britain March 10, 2022. REUTERS/Toby Melville

By Huw Jones

LONDON (Reuters) - Britain's financial watchdog has told firms offering 'buy now, pay later' loans to spell out the cost of late repayments to customers as the UK cost-of-living crisis intensifies.

Companies like Klarna led the way in offering on-the-spot, interest-free, short-term loans to customers which spread repayments for buying goods like clothes over a few weeks.

Lenders make money by taking a cut from what they help retailers sell, and banks are now piling in to serve customers who would normally be unable to get a credit card or would fail strict credit checks.

BNPL loans are unregulated in Britain, but the Financial Conduct Authority has powers to intervene in how they are advertised.

The FCA told BNPL firms and the British Retail Consortium in letters published on Friday that benefits of 'buy now, pay later' were being emphasised in adverts without fair and prominent indications of any relevant risks.

Some BNPL lenders charge late payment fees, and a failure to pay can also hit consumers' credit ratings.

The watchdog said it would use criminal and regulatory enforcement powers to tackle promotions which breach its rules.

"Unauthorised firms might be committing a criminal offence if they don’t have an FCA-authorised firm approve their financial promotions," the watchdog said.

So far this year, the FCA has forced 4,226 promotions to be withdrawn or amended.

Money is becoming tighter for many consumers faced with rocketing energy tariffs and 40-year high inflation pushing up food prices, making BNPL products an option in a financial squeeze.

"As we face a cost-of-living crisis, consumers are having to make difficult decisions about their finances and how they pay for goods and services," said Sheldon Mills, the FCA's executive director of consumers and competition.

Britain is to hold a public consultation on draft legislation to introduce BNPL affordability checks.

The FCA in February told BNPL operators Clearpay, Klarna, Laybuy and Openpay to change their contracts after identifying potential harm to customers. It had to use Britain's consumer rights law to do so.

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29-03-2024 16:14:43 (UTC+7)

EUR/USD

1.0777

-0.0010 (-0.09%)

Summary

Sell

Moving Avg:

Buy (6)

Sell (6)

Indicators:

Buy (2)

Sell (6)

EUR/USD

1.0777

-0.0010 (-0.09%)

Summary

Sell

Moving Avg:

Buy (6)

Sell (6)

Indicators:

Buy (2)

Sell (6)

GBP/USD

1.2627

+0.0004 (+0.04%)

Summary

↑ Buy

Moving Avg:

Buy (8)

Sell (4)

Indicators:

Buy (7)

Sell (1)

USD/JPY

151.34

-0.03 (-0.02%)

Summary

Sell

Moving Avg:

Buy (4)

Sell (8)

Indicators:

Buy (3)

Sell (4)

AUD/USD

0.6514

-0.0001 (-0.02%)

Summary

↑ Buy

Moving Avg:

Buy (12)

Sell (0)

Indicators:

Buy (5)

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USD/CAD

1.3550

+0.0012 (+0.09%)

Summary

Neutral

Moving Avg:

Buy (0)

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Buy (4)

Sell (2)

EUR/JPY

163.10

-0.15 (-0.09%)

Summary

Sell

Moving Avg:

Buy (6)

Sell (6)

Indicators:

Buy (1)

Sell (7)

EUR/CHF

0.9718

-0.0009 (-0.09%)

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↑ Buy

Moving Avg:

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Buy (7)

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Gold Futures

2,254.80

42.10 (1.90%)

Summary

Buy

Moving Avg:

Buy (11)

Sell (1)

Indicators:

Buy (5)

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Silver Futures

25.100

+0.002 (+0.01%)

Summary

↑ Buy

Moving Avg:

Buy (12)

Sell (0)

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Buy (8)

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Copper Futures

4.0115

-0.0003 (-0.01%)

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↑ Buy

Moving Avg:

Buy (11)

Sell (1)

Indicators:

Buy (7)

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Crude Oil WTI Futures

83.11

+1.76 (+2.16%)

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↑ Buy

Moving Avg:

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Buy (8)

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Brent Oil Futures

86.99

+0.04 (+0.05%)

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Neutral

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Natural Gas Futures

1.752

+0.034 (+1.98%)

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Buy (0)

Sell (6)

US Coffee C Futures

188.53

-2.12 (-1.11%)

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↑ Sell

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Buy (0)

Sell (12)

Indicators:

Buy (0)

Sell (9)

Euro Stoxx 50

5,082.85

+1.11 (+0.02%)

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↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (2)

Sell (6)

S&P 500

5,254.35

+5.86 (+0.11%)

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↑ Sell

Moving Avg:

Buy (1)

Sell (11)

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Buy (3)

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DAX

18,504.51

+27.42 (+0.15%)

Summary

↑ Buy

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Buy (12)

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Buy (9)

Sell (0)

FTSE 100

7,952.62

+20.64 (+0.26%)

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↑ Sell

Moving Avg:

Buy (0)

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Buy (0)

Sell (10)

Hang Seng

16,541.42

0.00 (0.00%)

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Neutral

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (3)

Sell (1)

US Small Cap 2000

2,120.15

+5.80 (+0.27%)

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Neutral

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (5)

Sell (4)

IBEX 35

11,074.60

-36.70 (-0.33%)

Summary

↑ Sell

Moving Avg:

Buy (0)

Sell (12)

Indicators:

Buy (2)

Sell (5)

BASF SE NA O.N.

52.930

-0.320 (-0.60%)

Summary

↑ Buy

Moving Avg:

Buy (9)

Sell (3)

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Buy (6)

Sell (1)

Bayer AG NA

28.43

+0.01 (+0.04%)

Summary

Buy

Moving Avg:

Buy (6)

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Buy (7)

Sell (1)

Allianz SE VNA O.N.

277.80

+0.35 (+0.13%)

Summary

↑ Buy

Moving Avg:

Buy (12)

Sell (0)

Indicators:

Buy (9)

Sell (0)

Adidas AG

207.00

+2.30 (+1.12%)

Summary

↑ Buy

Moving Avg:

Buy (12)

Sell (0)

Indicators:

Buy (6)

Sell (0)

Deutsche Lufthansa AG

7.281

+0.104 (+1.45%)

Summary

↑ Sell

Moving Avg:

Buy (4)

Sell (8)

Indicators:

Buy (0)

Sell (6)

Siemens AG Class N

176.96

+0.04 (+0.02%)

Summary

↑ Buy

Moving Avg:

Buy (12)

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Indicators:

Buy (10)

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Deutsche Bank AG

14.582

-0.030 (-0.21%)

Summary

↑ Buy

Moving Avg:

Buy (12)

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Indicators:

Buy (7)

Sell (1)

 EUR/USD1.0777Sell
 GBP/USD1.2627↑ Buy
 USD/JPY151.34Sell
 AUD/USD0.6514↑ Buy
 USD/CAD1.3550Neutral
 EUR/JPY163.10Sell
 EUR/CHF0.9718↑ Buy
 Gold2,254.80Buy
 Silver25.100↑ Buy
 Copper4.0115↑ Buy
 Crude Oil WTI83.11↑ Buy
 Brent Oil86.99Neutral
 Natural Gas1.752↑ Sell
 US Coffee C188.53↑ Sell
 Euro Stoxx 505,082.85↑ Sell
 S&P 5005,254.35↑ Sell
 DAX18,504.51↑ Buy
 FTSE 1007,952.62↑ Sell
 Hang Seng16,541.42Neutral
 Small Cap 20002,120.15Neutral
 IBEX 3511,074.60↑ Sell
 BASF52.930↑ Buy
 Bayer28.43Buy
 Allianz277.80↑ Buy
 Adidas207.00↑ Buy
 Lufthansa7.281↑ Sell
 Siemens AG176.96↑ Buy
 Deutsche Bank AG14.582↑ Buy
Mua/Bán 1 chỉ SJC
# So hôm qua # Chênh TG
SJC Eximbank7,910/ 8,080
(30/ 30) # 1,364
SJC HCM7,900/ 8,100
(0/ 0) # 1,384
SJC Hanoi7,900/ 8,102
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SJC Danang7,900/ 8,102
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SJC Nhatrang7,900/ 8,102
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SJC Cantho7,900/ 8,102
(0/ 0) # 1,386
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Cập nhật lúc 16:09:47 29/03/2024
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