CHOICE has led a joint submission Treasury's consultation on draft regulations to support the new buy now pay later laws. We support the majority of the content of the regulations, except for a change to late fees that will increase the costs of late fees under the Afterpay BNPL model.
The proposed regulations contain a more than doubled late fee cap for BNPL lenders that do not charge any fees upfront. We strongly oppose this change because it is highly likely to lead to high fees for people on low incomes struggling to make repayments, as a trade off to finance a 'free' lending model for other users. We have strongly urged the government to reverse this change and maintain a consistent annual cap on late fees for all BNPL models.
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