The Bank of Russia is weighing a potential cap on the amount of free installments offered by BNPL services. This consideration was reported to the news agency RBC by the Central Bank. The move signals a broader effort to tighten how buy now, pay later arrangements operate within the financial landscape and to better shield consumers from excessive borrowing related to short-term purchases.
Officials indicate that legislation governing the use of BNPL options for buying goods and services could undergo changes by June 1 of this year. The proposed reforms would address two distinct installment models: paid installments and free installments, each with its own set of regulatory contours.
Under the paid installment model, the arrangement resembles a consumer loan. In this setup, lenders with professional authorization would be expected to issue and oversee these installment plans, ensuring compliance with established lending standards and consumer protection rules. The framework would emphasize responsible lending practices, clear disclosure of terms, and straightforward repayment schedules to minimize the risk of over-indebled consumers.
Free installments, on the other hand, would be administered by specialist operators. For these services, regulators are considering introducing safeguards designed to protect consumer rights without imposing the same licensing standards that apply to traditional lending. The aim is to balance access to flexible payment options with explicit protections for purchasers, including transparent terms, reliable dispute resolution mechanisms, and oversight to prevent predatory practices.
For free installment offerings, the Central Bank is evaluating the possibility of adding a cap on the purchase amount. At present, discussions center on a limit that falls within a 60,000 to 80,000 ruble range for a single purchase paid in installments. This threshold would help delineate between smaller, consumer-friendly bursts of credit and larger financing arrangements that require more stringent oversight. The objective is to curb the risk of debt accumulation among buyers who may rely on free installment plans for multiple purchases in a short period.
In related developments, legal expert Gusyatnikov has commented on the authority of the bank to adjust cash withdrawal terms from credit cards. Those remarks underscore the ongoing willingness of regulators to recalibrate financial products in response to evolving market conditions and consumer behavior, aiming to preserve market stability while preserving consumer choice.
Meanwhile, there are indications that Russia’s largest marketplaces may soon establish a Digital Platforms Association. The anticipated association would likely serve as a coordinated voice for major online marketplaces, promoting best practices in digital commerce, data handling, and consumer protection across platforms while supporting regulatory compliance. This potential development reflects a broader trend toward organized industry oversight and collaborative governance in the digital shopping ecosystem. attribution: Central Bank communications and public statements; market observers monitoring policy directions.