Guidelines include imposing a limit of USD 1,406 in accumulated outstanding payments at any given time for each BNPL provider, unless the customer completes additional credit assessment. Consumers are also now entitled to make full repayment without early repayment fees.
For the additional assessment, providers must consider, amongst others, the customer’s income information and the customer’s credit information shared across all BNPL firms. BNPL providers are directed to suspend a customer’s access and use of its BNPL services should they fail to meet any payment obligations.
Providers are also guided to be transparent with their fees. BNPL providers must cap all fees, including late fees and other charges. Fees and interest should not be compounded, the working group said. They are also required to ensure that consumers have access to account statements consolidating the total outstanding balance of purchases made through the respective BNPL provider.
Additionally, BNPL providers must consider extending hardship assistance to consumers facing financial hardships to work out a mutually acceptable payment arrangement with them. During this time, BNPL providers will not allow any further transactions. These institutions must also commit not to initiate bankruptcy proceedings against their customers, according to the code.
BNPL providers will be required to undergo an audit and accreditation process which will allow them to display an accredited trustmark showing customers that they are compliant with the BNPL Code.
The BNPL working group was formed by the Singapore Fintech Association (SFA) alongside industry players that included Atome, Grab Financial Group, and ShopBack. The group was guided by the Monetary Authority of Singapore in forming the BNPL Code.
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