Section 1 Short title
This Act may be cited as the “Buy Now, Pay Later Protection Act of 2025”.
Buy Now, Pay Later Protection Act of 2025
A BILL
To amend the Truth in Lending Act and the Consumer Financial Protection Act of 2010 to apply certain protections and oversight to buy now, pay later loans, and for other purposes.
Sec. 2 Application of the Truth in Lending Act to buy now pay later loans
in section 103 (15 U.S.C. 1602), by adding at the end the following:
“(ff) Buy now, pay later loan—The term buy now, pay later loan means a closed-end consumer loan for a retail transaction that—
“(1) is repaid in not more than 4 interest-free installments; and
“(2) does not impose a finance charge.”
in section 127 (15 U.S.C. 1637)—
in subsection (a), by striking “under an open end consumer credit plan” and inserting “under an open end consumer credit plan or a buy now, pay later loan” each place it occurs; and
in subsection (b), by striking “under an open end consumer credit plan” and inserting “under an open end consumer credit plan or a buy now, pay later loan” each place it occurs;
in section 170 (15 U.S.C. 1666i)—
in the section heading, by striking “Rights of credit card customers.” and inserting “Rights of credit card customers and buy now, pay later loan customers.”;
in subsection (a)—
by striking “a card issuer who has issued a credit card to a cardholder pursuant to an open end consumer credit plan” and inserting “a card issuer who has issued a credit card to a cardholder pursuant to an open end consumer credit plan or a creditor who has provided a buy now, pay later loan to a consumer”;
by striking “in which the credit card” and inserting “in which the credit card or buy now, pay later loan”;
by striking “honoring the credit card” and inserting “honoring the credit card or buy now, pay later loan” each place it occurs;
by striking “provided by the cardholder” and inserting “provided by the cardholder or consumer”;
by striking “defenses against a card issuer” and inserting “defenses against a card issuer or creditor”;
by striking “is the same person as the card issuer” and inserting “is the same person as the card issuer or creditor”;
by striking “is controlled by the card issuer,” and inserting “is controlled by the card issuer or creditor,”;
by striking “common control with the card issuer” and inserting “common control with the card issuer or creditor”;
by striking “in the card issuer's products” and inserting “in the card issuer's or creditor’s products”;
by striking “by the card issuer in which” and inserting “by the card issuer or creditor in which”; and
by striking “using the credit card issued by the card issuer” and inserting “using the credit card issued by the card issuer or the buy now, pay later loan provided by the creditor”; and
in subsection (b)—
by striking “asserted by the cardholder” and inserting “asserted by the cardholder or consumer”;
by striking “at the time the cardholder first notifies the card issuer or the person honoring the credit card of such claim or defense” and inserting “at the time the cardholder or consumer first notifies the card issuer or creditor or the person honoring the credit card or buy now, pay later loan of such claim or defense”; and
by striking “the cardholder's account” and inserting “the cardholder's account or the consumer's buy now, pay later loan account”;
in section 161 (15 U.S.C. 1666)—
in subsection (a), in the matter preceding paragraph (1), by striking “in connection with an extension of consumer credit,” and inserting “in connection with an extension of consumer credit, including a buy now, pay later loan,”; and
in subsection (d), by striking “an open end consumer credit plan” and inserting “an open end consumer credit plan or a buy now, pay later loan”; and
in section 171(a) (15 U.S.C. 1666i–1), by striking “In the case of any credit card account under an open end consumer credit plan” and inserting “In the case of any credit card account under an open end consumer credit plan or buy now, pay later loan”.
Rulemaking— Not later than 1 year after the date of enactment of this Act, the Consumer Financial Protection Bureau shall issue such rules as the Bureau determines necessary to carry out the amendments made by subsection (a).
Sec. 3 Federal supervision of buy now, pay later loan lenders
Section 1024(a)(1) of the Consumer Financial Protection Act of 2010 (12 U.S.C. 5514(a)(1)) is amended—
in subparagraph (D), by striking “; or” and inserting a semicolon;
in subparagraph (E), by striking the period at the end and inserting “; or”; and
by adding at the end:
“(F) offers or provides to a consumer a buy now, pay later loan, as defined in section 103 of the Truth in Lending Act (15 U.S.C. 1602).”