Buy now pay later debt is soaring – we welcome the government’s crackdown

Here at Money Wellness, we support the government’s plan to tighten buy now pay later (BNPL) rules.

Here’s why it matters.

On 19 May, the government confirmed it’s cracking down on BNPL, the payment method that lets you delay or split the cost of purchases.

From 2026, BNPL providers will be regulated by the Financial Conduct Authority (FCA).

That means:

• affordability checks before you borrow
• stronger protections if something goes wrong

BNPL can be a handy way to manage your money. But when used too often, or without proper checks, it can quickly become difficult to manage.

BNPL debt is soaring

Over the past year, we’ve seen a sharp rise in people struggling with BNPL:

• 68% more people came to us for help with BNPL debt
• BNPL balances jumped 40% among customers receiving debt help
• average BNPL debt rose to £941, up from £675 a year ago

Perhaps even more concerning, people are now using BNPL to pay for everyday essentials, rather than one-off luxury items.

Who’s most affected?

Our data shows that BNPL debt is hitting some groups harder than others:

• 25–34-year-olds are most affected, often dealing with stagnant wages, insecure work and rising living costs

• single parents and low-income families are overrepresented in BNPL debt cases

‘Plugging the gaps in everyday budgets’

Many people don’t even realise it’s debt, until the repayments begin piling up.

Sebrina McCullough, our director of external relations,  warned how the rise in people struggling with BNPL is often because they’ve used it to ‘plug the gaps in everyday budgets’.

“For many, it’s become a way to spread the cost of essentials like food shopping, rather than to cover large expenses.

“While BNPL can be helpful when used carefully, the lack of checks and the ease of stacking multiple agreements has left some people facing hundreds - even thousands - in repayments they can’t afford.

“The government’s move to introduce regulation is a welcome step that should help prevent more people from getting into difficulty”, McCullough added.

Our BNPL guide explains how this type of lending works and what do to if you fall behind on repayments.