Buy now, pay later firm Laybuy collapses into administration

One of the UK’s main buy now, pay later companies has collapsed into administration just days after suspending payments.

Around 2,600 shops and businesses in the UK use Laybuy, which lets you pay for things using credit before repaying it back over six weeks.

But the New Zealand-based business is no longer lending any money for new orders after calling in the administrators on 24 June.

Don’t be tempted to miss your repayments

If you’ve used Laybuy to buy now and pay later, administrators FTI Consulting say you should continue to make your repayments as normal.

Administration doesn’t affect the repayment terms of your credit agreement, so there could still be consequences if you miss a payment. 

Is buy now, pay later protected?

Buy now, pay later agreements don’t have the same protection as other forms of credit, e.g. credit cards.

Providers aren’t regulated in the same way banks are, so they don’t have to be as strict with their checks.

This means they could lend you more than you can afford to pay back, causing you further money problems down the line.

If you’ve borrowed money from a regulated financial firm, you’re also protected by the Financial Ombudsman Service (FOS), which resolves disputes.

Buy now, pay later users aren’t protected in the same way.

What’s next for Laybuy?

Administrators FTI Consulting, says they’re assessing Laybuy’s options.

Laybuy’s southern hemisphere branches were placed into receivership in mid-June after failing to find a buyer or additional investment.

Part or all of the business could be sold if an interested buyer is found.

If the company can’t be saved or a new owner isn’t found, Laybuy could end up being liquidated.

Further updates will be shared on FTI’s website.