Retail finance after BNPL regulation: what businesses are asking now

In our first ‘In the Spotlight’ article, Rachel McTague, Senior Business Development Manager at Product Partnerships Ltd, explains why she believes retailers should look beyond the recent deadline and start to focus on reviewing the wider finance journey.

BNPL regulation is now live, but for the many retailers I speak to on a daily basis, the conversation hasn’t stopped now that the regulation deadline has passed. 

If you missed it, Deferred Payment Credit, often known as Buy Now Pay Later, entered FCA regulation on 15 July 2026 where it is in scope.

A positive of the deadline is that it has made many businesses look at themselves from a fresh perspective and really drill down into how finance appears across their customer journey, not just about BNPL. 

They are becoming even more aware of the importance of their customer experience, their checkout journeys, their lender relationships, acceptance and decline routes, financial promotions, complaints, permissions and whether the current finance proposition is still fit for purpose. 

What retailers are asking now BNPL regulation is live

The first question I have to businesses who reach out to me about BNPL is whether they understand where it sits in their finance journey. 

Some retailers are not the lender, but they still have a very visible role in how finance is presented to customers. 

That might be on their website, in their checkout, through email marketing, in-store signage, point-of-sale screens or staff conversations. 

So, the practical question is not only, 'Are we the regulated lender?' It is also, 'What does the customer see, who controls the wording, at what point is the customer passed to the lender, and what happens if something goes wrong?' 

This isn’t just a BNPL issue

BNPL is the current big talking point, but it is not the whole story. From experience, I’ve seen many higher-value sectors use a wide mix of finance options. That might include retail finance, interest-free credit, interest-bearing credit, instalment plans, patient finance or other third-party payment options. The same core questions apply across all of them.

• How is finance introduced?

• What is the customer told?

• Who approves the wording?

• What is recorded?

• How are complaints routed?

• Does the business have the right structure or permissions for the role it plays?

Retailers can become too reliant on one finance provider

A provider-led finance model can look attractive because it may appear to give the retailer a ready-made route to offering finance, with the product, technology and compliance support built around that provider's own journey. Retailers still need to ask whether the arrangement gives them enough flexibility for the future.

• What happens if decline rates increase?

• What happens if the retailer wants to offer interest-bearing finance, a different instalment product, or work with more than one lender?

• What happens if the customer journey needs to change, or if the retailer's own permissions, appointed representative structure or financial promotions need to be reviewed? 

The key point is that retailers should not confuse having a finance provider in place with having a finance strategy. They need to understand what they can do under their current structure, what sits with the lender or provider, what still sits with the retailer, and whether the model supports the way they want to sell in the future.

That is where independent support on retail finance solutions and consumer credit compliance can be valuable. It helps the retailer look at the whole finance journey, not just one provider relationship.

The sectors I’m finding are asking the most questions

The sectors where the conversation feels most relevant are often those where finance is close to the sales conversation. That includes jewellers, dentists, opticians, furniture retailers, bathroom retailers, home improvement businesses and other firms selling higher-value products or services. It can also include less obvious sectors, such as agricultural equipment, power tools and trade-focused retail, where high-value purchases may involve a mixture of consumer and business customers. 

For a jeweller, finance may be part of a high-value and emotional purchase.

For a dental practice, it may sit close to a treatment discussion.

For a bathroom or furniture retailer, finance may be part of a longer sales journey involving quotes, showrooms and follow-up conversations. 

For agricultural equipment, power tools or trade-focused retail, the questions may include whether the customer journey is consumer, business or mixed, how finance is introduced, and whether permissions and customer communications still match the way the business sells. 

The customer journeys are different, so the compliance and commercial questions are not always the same. 

The things some businesses sometimes overlook

One area is what happens when a customer is declined. A lot of businesses focus on getting the finance option live, but they may not have looked closely enough at the decline journey. 

• What does the customer see?

• Is the next step clear?

• Are alternative payment options available?

• Does the business have the right permissions or structure if it wants to introduce other finance products? 

Another area is provider oversight. Retailers may rely heavily on a finance provider, but that does not mean the relationship should be treated as a black box. The retailer should understand how the journey works, what changes after regulation, what data or management information is available, and who owns the relationship internally. 

Understanding that it’s a commercial issue, not just a compliance issue, is key

Finance can affect the whole customer journey. If the journey is confusing, too slow, poorly explained or inconsistent across channels, it can create friction for the customer. If acceptance rates change, or if customers are declined more often, the business needs to understand what happens next. Reviewing finance is not about adding unnecessary complexity. It can help retailers make the customer journey clearer, staff conversations more consistent and provider relationships more effective. It can also help firms understand whether their current finance proposition still supports the way customers want to buy. 

How PPL comes into the conversation

As compliance specialists in retail finance solutions, PPL supports firms in a few different ways. That can include reviewing customer finance journeys, checking financial promotions, advising on permissions, supporting Appointed Representative or Direct Authorisation routes where relevant, helping with complaints processes, providing training, reviewing provider relationships and supporting point-of-sale finance systems. 

For some firms, the starting point is a regulatory question. For others, it is a customer journey or commercial question. The important thing is to understand how finance works in practice, not just how it appears on paper. What should retailers review first? Start with the customer journey. Map every place finance appears before, during and after the sale.

That includes website pages, checkout screens, email campaigns, adverts, in-store conversations, sales scripts, quote documents, payment tablets and complaint routes. Then ask whether the journey is clear, consistent and properly evidenced. BNPL regulation may have triggered the conversation, but the wider opportunity is for retailers to build finance journeys that are easier for customers to understand, easier for staff to follow and easier for the business to manage. That is where the real value sits.

Rachel McTague

Senior Business Development Manager

Product Partnerships Limited (PPL)