Buy Now, Pay Later programs are effectively the same as credit cards, the Consumer Financial Protection Bureau said Wednesday.
In what it called an interpretive rule, the federal consumer watchdog agency said so-called BNPL lenders are obligated to offer refunds and allow users to dispute charges just like they can with traditional credit cards.
“When consumers check out and choose Buy Now, Pay Later, they don’t know if they will get a refund if they return their product or whether the lender will help them if they didn’t get what was promised,” Consumer Financial Protection Bureau Director Rohit Chopra said in a statement.
“Regardless of whether a shopper swipes a credit card or uses Buy Now, Pay Later, they are entitled to important consumer protections under longstanding laws and regulations already on the books.”
The CFPB said it has been investigating the BNPL industry for more than two years and often receives complaints about refunds and disputed transactions in such programs. About 13% of BNPL transactions involve a dispute or return, the agency said.
BNPL programs that let customers pay for products over time without paying interest have grown in recent years. A new Federal Reserve Economic Well-Being of U.S. Households report released this week said 14% of U.S. adults reported using Buy Now, Pay Later programs last year — a 2% increase compared with 2022.
Consumers’ top reasons for using BNPL were wanting to spread out payments (87%) and convenience (82%). More than half of BNPL users said it was the only way they could afford to buy what they did.
The CFPB said BNPL programs are advertised as a payment option at checkout, similar to credit cards. They work as digital accounts that link to a company’s web site or mobile app. Merchants are charged transaction fees, similar to credit cards.
The CFPB said BNPL programs fall under the purview of the Truth in Lending Act, requiring lenders to investigate disputes initiated by consumers and pause payments while they are investigated. The act also ensures lenders credit refunds to consumer accounts and provide billing statements.
“President Biden has encouraged his Administration to do everything possible to crack down on corporate rip-offs,” National Economic Council Deputy Director Jon Donenberg said in a statement about the rule. “The Consumer Financial Protection Bureau is answering that call by making sure Buy Now, Pay Later platforms abide by the law, including providing refunds when products are returned or not delivered.”
The interpretive rule comes less than a week after the Supreme Court preserved the current funding structure for the agency, which was established during the Obama administration to enforce federal protections for consumer financial products.
Egypt’s Finance Minister Mohamed Maait announced the successful delivery of over 28,000 new, eco-friendly cars under a presidential initiative to replace older vehicles.
Despite economic challenges including supply chain disruptions and inflation, the initiative has provided beneficiaries with current-year models at below-market prices and with 7 or 10-year installment plans.
Launched in March 2021, the initiative allows recipients to replace vehicles that are 20 years or older.
The government has demonstrated its commitment to promoting eco-friendly transportation by allocating EGP 718m in green incentives for these cars. Participants also benefit from a 3% flat annual interest rate, reduced insurance costs, and a complimentary EGP 100,000 personal accident insurance policy for the driver.
The initiative has expanded to numerous governorates, including Cairo, Giza, and Alexandria, reflecting the government’s goal of broadening the program’s reach and promoting green transportation nationwide. This effort aligns with fostering a green transition, increasing the prevalence of eco-friendly vehicles, and localizing the automotive industry.
The Minister emphasized ongoing efforts to develop Egypt’s automotive sector, with the aim of establishing the country as a regional hub for car manufacturing and export.
The government envisions a future where electric vehicles gradually replace traditional cars, contributing to the expansion of clean energy, reducing reliance on petroleum products, and easing the financial burden on citizens.
Congratulations to recent college graduates. Many graduates have already landed a job. Others may still be looking for an offer or waiting until summer’s end before job hunting. Whatever path you’re on, once you’re earning an income it’s critical to establish a solid financial foundation.
That’s always been true. But the changing nature of work — likely defined by multiple jobs and fluid careers — increases the need for embracing sound personal finance.
Three quick points. First, you’ll make mistakes with money. Everyone does. That’s how we learn. Second, keep your money management simple. Life is busy enough without falling into financial complexity. Finally, doing well with money isn’t rocket science. Good money management mostly involves developing a few good spending and savings habits. Here are several suggestions:
Concentrate on your career. Your most important financial investment is in your career(s). The big return on investment comes from the income you earn from your knowledge. Plan on continuously investing in your skills.
Create a budget. A budget lets you know where your money is going, and where you might want to make some adjustments. The information is vital.
Start saving with your first paycheck. This is true even if it’s a miniscule amount (which is likely). Put your savings on autopilot and adjust the sum upward when your pay increases. Savings is both your emergency fund and your opportunity fund.
Embrace frugality. There is a wide range of frugal behaviors, and you should find the thrifty habits that work for you. The frugal path means being cautious with debt. Frugality leads to greater freedom of choice. (Most college graduates owe on their student loans; research your repayment options and pick the best choice for your circumstances.)
Start the habit of giving money away. The thoughtfulness that comes from deciding where to give money creates strong connections to our community. The act of giving is a powerful reminder of what matters.
Invest in your financial education. There is no shortage of good resources, ranging from your employer to community organizations that promote financial literacy. Looking over my bookshelves, I’d highlight “Get a Financial Life: Personal Finance in Your Twenties and Thirties” by Beth Kobliner.
That’s enough to get started. Good luck on the next stage of life!
Chris Farrell is senior economics contributor, “Marketplace”; commentator, Minnesota Public Radio.
MOUNT VERNON, Ill. — The Mount Vernon Township High School finance committee and school board will meet Monday, June 24. The finance committee will meet at 5:30 p.m. and the board will meet at 6 p.m.
The finance committee meeting agenda is as follows:
Mt. Vernon Township High School
FINANCE COMMITTEE MEETING
Monday, June 24, 2024
5:30 p.m.
The agenda for the board meeting is attached:
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