Regulation changes for non-authorised retailers

From 15 July 2026, Buy Now Pay Later (BNPL), now more commonly referred to as Deferred Payment Credit (DPC), is undergoing a major shift in the UK. What was once treated as a simple payment option will officially become regulated consumer credit under the Financial Conduct Authority (FCA).

This includes the interest free credit under 12 months being offered by non-regulated firms.

For retailers offering DPC through third-party providers, this doesn’t mean you need to become FCA-authorised, but it does mean the way you present and support DPC needs to change.

Here’s what you need to know.

DPC is becoming regulated - what changes?

The biggest shift is how DPC is classified.

From July 2026, DPC will no longer be considered just a payment method. It will be treated as regulated consumer credit and customers will benefit from stronger protections.

For retailers, this means greater responsibility in how DPC is communicated - even if the credit itself is provided by a third party like Novuna.

Do retailers need FCA authorisation?

In most cases, no. If you're a non-regulated retailer offering interest free credit terms under 12 months:

• You do not need FCA authorisation
• You do not become a lender or credit broker

However, there’s an important nuance: while many DPC introductions remain exempt from regulation, you are still responsible for how DPC is presented to customers.

What information must customers receive?

Before a customer enters into a DPC agreement, they must be given clear, structured information.

Key product information

This includes:

• Total amount of credit
• Repayment amounts and schedule
• Consequences of missed payments

Additional product information

Customers must also have access to:

• Cancellation and early settlement rights
• Complaints process and Financial Ombudsman Service (FOS) access

This applies across both online and in-store journeys.

Affordability checks are now mandatory

One of the most significant operational changes is around affordability.

From July 2026 all DPC transactions require creditworthiness and affordability checks. This applies regardless of order value.

What this means in practice:

• Customers may need to provide additional information (e.g. date of birth, address confirmation)
• Checkout journeys may include extra steps or pauses
• Real-time decisioning (approve/decline/alternative offer) becomes standard

Retailers aren’t responsible for making lending decisions, but your systems must support the process.

New rules for financial promotions

DPC marketing will now fall under the FCA’s financial promotions regime.

This applies to all customer-facing messaging, including:

• Website and app content (checkout, banners, FAQs)
• In-store signage and POS materials
• Paid media and social advertising
• Emails, SMS and push notifications
• Printed marketing

If it references any of the below, it's in scope:

• Instalments
• “Buy now, pay later”
• Payment timing or affordability
• Consequences of missed payments

Approval requirements: what retailers must do

From July 2026, all DPC financial promotions must be approved by an FCA-authorised third party firm before use.

Note: Novuna is not authorised to approve the financial promotions of our retail partners.

This creates a clear compliance expectation: Using unapproved or self-created messaging increases regulatory risk. Approved, lender-provided materials (such as those from Novuna) offer a safer route.

Using pre-approved assets helps ensure:

• Regulatory consistency
• Reduced compliance risk
• Faster implementation across channels

What should retailers do now?

To prepare for the changes, retailers should focus on three key areas:

1. Audit marketing materials

Identify any content referencing DPC and ensure:

• It meets FCA standards
• It is (or will be) properly approved

2. Use approved assets

Where possible, switch to lender-provided, compliant materials to minimise risk. Retailers using Novuna can contact their Relationship Manager for a comprehensive suite of pre-approved assets.

3. Review customer journeys

Ensure checkout flows allow for:

• Additional data capture
• Affordability checks
• Clear information delivery

Note: unregulated finance via the Novuna Creditmaster3 journey already meets requirements. If you are a Novuna retailer, your Relationship Manager will be in touch if anything should need to change.

Final thoughts

DPC regulation is evolving, and while retailers aren’t being brought fully into the regulated space, expectations are clearly increasing.

The key takeaway:
You don’t need authorisation, but you do need to get the details right.

Clear communication, compliant promotions, and seamless integration with your DPC provider will be essential to staying on the right side of regulation, while continuing to offer flexible payment options to your customers.