FinTech UK BNPL Platform -- FCA Regulated Consumer Credit

FCA CONC for BNPL

• 1CONC 5.2A creditworthiness assessment (affordability check -- income vs expenditure, existing debt obligations -- ClickMasters integrates Open Banking TrueLayer for income verification + CRA (Credit Reference Agency -- Experian/Equifax) for existing debt),
• 2CONC 4.2 Pre-Contract Information (SECCI -- Standard European Consumer Credit Information -- must be provided before credit agreement),
• 3CONC 6.7 Arrears management (if customer misses payment -- forbearance policy, breathing space, StepChange referral),
• 4CONC 3.3 Financial promotions (BNPL must not be promoted in a way that encourages over-indebtedness),
• 5CONC 13 Cancellation rights (CCA 1974 Section 66A -- 14-day withdrawal right for BNPL, no penalty).

FCA Consumer Duty BNPL Design

FCA Consumer Duty for BNPL (2026 priority sector for FCA): (1) Product design outcome (BNPL product designed so customers who should not be offered credit are not offered it -- affordability check gate), (2) Price and value outcome (no fees charged to customer in good standing -- transparent fee structure), (3) Consumer understanding outcome (SECCI in plain English -- Flesch-Kincaid Grade Level 7 or below, confirmed in User Testing with representative sample), (4) Consumer support outcome (FCA DISP complaint response within 8 weeks, FOS referral information, breathing space signposting), (5) Vulnerable customers (FCA FG21/1 -- BNPL does not promote to known vulnerable customers, forbearance available from day 1 of arrears).

BNPL credit decisioning

• 1Open Banking affordability (TrueLayer AISP -- customer shares bank data, income and expenditure extracted, disposable income calculated),
• 2CRA credit check (Experian Bureau Score + existing BNPL debt flag),
• 3decision engine (scorecard -- Open Banking + CRA + order value + merchant category),
• 4ICO DPIA (automated credit decision = ICO Article 22 -- right to human review for rejected applications -- automated decision gateway requires human review option),
• 5credit limit setting (based on scorecard -- initial limit GBP200-GBP1,000, increases earned by repayment behaviour). FCA CONC 5.2A: creditworthiness assessment must include information about existing debt -- CRA mandatory for responsible lending compliance.

FCA PS21/3 IBS

BNPL payment collection is an IBS.

Impact Tolerance

4-hour maximum downtime for repayment collection (customer payments cannot be lost -- Direct Debit mandate or GoCardless VRP).

Repayment infrastructure

• 1GoCardless BACS Direct Debit (monthly repayment mandate -- predictable, low failure rate),
• 2GoCardless VRP option (flexible repayment amount -- customer chooses to pay more),
• 3payment failure workflow (GoCardless webhook on failure -- immediate customer notification, forbearance offered, StepChange referral),
• 4arrears management (day 1, 7, 14, 28 contact steps -- FCA CONC 6.7),
• 5debt sale prohibition (FCA CONC -- BNPL debt must not be sold to debt purchaser without customer consent).

PS21/3 quarterly chaos test

GoCardless API dependency failure test -- IBS recovery within 4 hours.