If you use Afterpay, Zip, Klarna or a similar buy now, pay later (BNPL) service, the rules changed under you in the past year. The Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Act 2024 received royal assent in December 2024, and from 10 June 2025 BNPL contracts are formally regulated under the National Credit Act for the first time.
What actually changed
BNPL products are now treated as a new category called low cost credit contracts (LCCCs) — a lighter-touch version of full credit regulation, but regulation all the same. In practice that means:
- BNPL providers now need an Australian Credit Licence (ACL) to operate, the same starting point as other lenders.
- Providers must run some form of affordability check before approving you, rather than relying purely on instant sign-up.
- You get access to AFCA's free dispute resolution and formal hardship protections if you fall behind — the same safety net that applies to personal loans and credit cards.
- Missed BNPL payments can now show up and affect your credit report, which wasn't reliably the case before.
What this means if you're weighing up BNPL vs a personal loan
The gap between BNPL and a small personal loan has narrowed. Both now involve some form of affordability assessment, and both can now affect your credit file if you don't keep up repayments. The practical differences that remain: BNPL is still typically interest-free (you're charged fees for missed payments instead), while a bad credit personal loan carries an upfront interest rate but usually gives you more borrowing room and a fixed, predictable repayment schedule.
If you're using BNPL to cover a larger or recurring expense rather than a one-off purchase, it's worth comparing the total cost against our bad credit personal loan options — for bigger amounts, a personal loan's fixed rate can end up cheaper than stacking several BNPL fees.
The bottom line
BNPL is no longer the lightly-regulated alternative to credit it was a couple of years ago. It's now a licensed credit product with real consumer protections behind it — which is good news if something goes wrong, but also a reminder that missed payments carry real consequences for your credit file, same as any other loan.