This week, Marqeta welcomed the recent Consumer Financial Protection Bureau (CFPB) rule on BNPL providers. In a statement, Marqeta said it appreciates the agency’s efforts to promote consistent consumer protection standards, including for BNPL.
“As BNPL providers reach greater levels of mainstream adoption, industry standardization and guidelines have an important role to play in continuing to cement and grow consumer trust, given the potential benefits offered to consumers through BNPL,” Marqeta said. “We will continue to work in lock-step with our BNPL customers to help drive continued innovation and enable consumer protections that are consistent and comparable with the payment method.”
Marqeta supports credit offerings, including revolving credit cards and BNPL. Among its focus areas is credit program management, which is designed to provide end-to-end management for customers launching credit card programs. The company said it will work with its customers to reflect the new rule while ensuring their businesses will continue to be supported to succeed at scale.
A crucial consideration is how Regulation Z covering the Truth in Lending Act, applies to BNPL products. Marqeta said the CFPB has directed providers to look closely at Subpart B for requirements that may apply to their business.
Subpart B addresses requirements such as:
- Providing disclosures when an account is opened with the provider;
- Providing a periodic billing statement showing the balance, charges and transactions on the account;
- Conducting a reasonable investigation of billing errors; and
- Providing refund rights and limiting liability for unauthorized use.
“The CFPB has also clarified that certain requirements that apply to traditional revolving consumer credit cards would not apply to BNPL providers,” Marqeta said. “Generally speaking, this will include most of the requirements found in Subpart G of Regulation Z, which (among other things) places specific limits on penalty fees and imposes particular considerations of the borrower’s ability to repay.
“We are committed to ensuring strong consumer protections and supporting our customers in continuing to power flexible payment options that help consumers meet their financial goals.”
