Fueled in large part by the meteoric growth of the giant Buy Now, Pay Later (BNPL) Klarna, the UK is set to experience its biggest holiday shopping season yet as more than 17 million UK customers have used BNPL to make an online purchase, according to a BBC report on Monday (November 29th).
The news follows a recent push for BNPL regulation, according to PYMNTS. BNPL usage nearly quadrupled in 2020 to reach 2.7 billion pounds ($ 3.6 billion) according to data from the Financial Conduct Authority.
Concerned about debt management resulting from the ease of making purchases and opting for installment payments, UK MP Stella Creasy earlier this month called on the government to pass legislation quickly.
The British organization Citizens Advice, which helps people in debt, with housing and others, also called for a BNPL regulation, according to PYMNTS.
Related: UK lawmaker calls for urgent regulation of buy-it-now and on-payment providers
Gary Rohloff, co-founder and CEO of BNPL LayBuy, told PYMNTS in a recent interview that his company was okay with the regulations. However, he pointed out that the company already has safeguards in place for consumers, including checking consumers’ creditworthiness and assigning an affordability score before issuing credit. In addition, if the installment payments are not made, the account is suspended.
LayBuy launched its BNPL offering in the UK in 2019 with the ability to make payments in six interest-free installments.
Read more: Merchant Education Key to Buy Now Pay Later Adoption in UK
BNPL Klarna, launched in the UK in 2014, has doubled its number of users to 15 million since early 2020.
Last week, Klarna announced that its Pay Now option has been added to its line of US payment services, in addition to the imminent launch of the Klarna card in the US market, according to PYMNTS. Over the past year, the company has nearly doubled the number of its customers in the United States to more than 21 million.
See more : Klarna introduces Pay Now and Klarna Card in the United States