Buy Now Pay Later (BNPL) has become an integral part of both e-commerce and brick-and-mortar retail. Payment methods such as invoice purchase, SEPA direct debit, or instalment payments allow customers to pay for their purchases flexibly—and help merchants reduce abandoned purchases and increase sales.

Until now, some of these payment options were not considered traditional consumer credit, especially when they involved small amounts, short terms, or interest-free offers. This is now changing with the revised EU Consumer Credit Directive (EU 2023/2225), known as CCD2, published on 30 October 2023. With this directive, the EU is introducing, for the first time, a unified legal framework for BNPL offerings and other forms of financing—with clear provisions for consumer protection.

From 20 November 2026, the new rules must be applied. It is therefore advisable for merchants to familiarise themselves with the changes at an early stage. Below, we provide an overview of the most important new regulations.

What is changing under the new Consumer Credit Directive?

In the past, BNPL payment options such as “invoice purchase” or “instalment payment” were usually exempt from comprehensive credit checks. These special provisions will now be discontinued.

The new directive significantly broadens the scope:

• Small amounts under €200, short terms (less than three months), and interest-free offers will also be subject to regulation in the future.
• Invoice purchasing will be regulated if a payment service provider is involved or if the payment term exceeds certain thresholds (e.g. more than 14 days).

New Obligations for Merchants

With the entry into force of the directive, merchants offering BNPL will be subject to two main new requirements in particular:

Enhanced Credit Assessment

Before concluding a BNPL contract, it must in future be checked whether customers are likely to be able to meet their payment obligations. The aim is to prevent over-indebtedness. Both the customer’s creditworthiness and any existing financial commitments must be taken into account.

Increased Transparency and Information Obligations

Customers must be clearly and comprehensibly informed about all relevant points before concluding the contract, including:

• Costs and fees
• Term and payment modalities
• Possible risk
• Key features of instalment purchases

The right of withdrawal must also be highlighted more clearly than before.

Additional Consumer Protection Rules

In addition to these two new obligations, further requirements to protect customers are being introduced. Excessive interest rates and additional fees are to be avoided, certain tie-ins between credit and other products will no longer be permitted, and misleading advertising will be more strictly limited.

Furthermore, the directive requires banks and payment service providers to proactively offer support to customers facing financial difficulties. If accounts are permanently overdrawn or instalments are outstanding, customers should be informed of support options at an early stage. The aim is to prevent customers from becoming overwhelmed and to assist them in finding solutions in good time.