November 20, 2026
On this date, the new EU Consumer Credit Directive (CCD II) comes into effect. Buy Now Pay Later services like Klarna, PayPal Pay Later, Afterpay and others will be regulated like bank loans.
What is BNPL and Why is it Being Regulated?
Buy Now Pay Later (BNPL) allows you to shop online or in-store and pay later - often in installments or after 30 days. Popular providers include Klarna, PayPal Pay Later, Afterpay, and Riverty (formerly AfterPay).
The problem: Until now, BNPL services were not subject to strict credit regulations because they often charged no interest or stayed below certain thresholds. The EU recognized that this can lead to over-indebtedness, especially among young people.
Key Changes - Step by Step
Credits Under 200 Euro Now Regulated
Previously, credit rules only applied from 200 euros. From November 2026, smaller amounts also fall under the Consumer Credit Directive.
Example: A Klarna purchase of 50 euros in 3 installments will be treated as a regular credit in the future.
BNPL Providers Under Banking Supervision
Klarna, PayPal Pay Later, and other BNPL providers will be supervised by banking authorities (BaFin in Germany) - just like regular banks.
What does this mean? Stricter capital requirements, more transparency, and better consumer protection.
Mandatory Credit Check (Bonitätsprüfung)
Before any BNPL use, the provider must check your creditworthiness. In Germany, this is done through Schufa or other credit bureaus.
Important for Expats: Without a Schufa entry, the credit check can be more difficult. Build your credit history first!
14-Day Withdrawal Right (Widerrufsrecht)
You will have 14 days to withdraw from a BNPL contract without giving any reason. This applies to all BNPL purchases.
How it works: Declare your withdrawal in writing (email is sufficient) within 14 days. The BNPL contract will be cancelled.
Mandatory Warning Notice
Every BNPL offer must clearly display the warning "Achtung! Kreditaufnahme kostet Geld" (Attention! Borrowing costs money).
Purpose: Consumers should understand that BNPL is a credit - even if it appears "interest-free".
Which Providers Are Affected?
BNPL Providers
- Klarna (Invoice, Installments)
- PayPal Pay Later / Pay in 3
- Afterpay / Clearpay
- Riverty (formerly AfterPay)
- Affirm
- Billie (B2B)
New Obligations
- Credit check before lending
- Clear cost information
- 14-day withdrawal right
- Mandatory warning notice
- BaFin supervision
- Complaints management
Benefits for Consumers
- Better protection from over-indebtedness: Credit checks ensure loans are only given to those who can afford them.
- More transparency: All costs must be clearly communicated - no more hidden fees.
- Withdrawal right: 14 days to reconsider and cancel the BNPL contract.
- Regulatory oversight: BaFin monitors BNPL providers and can intervene in case of violations.
Practical Tips for Consumers
- Keep track: Do not use multiple BNPL services simultaneously - this increases debt risk.
- Note due dates: Do not miss payment deadlines to avoid reminder fees.
- Consider alternatives: A regular credit card may be cheaper than multiple BNPL installments.
- Budget planning: Only buy what you could afford even without BNPL.
Regulation Timeline
EU adopts new Consumer Credit Directive (CCD II)
Implementation into national law by EU member states
New rules come into effect - all BNPL providers must be compliant
Conclusion
The new BNPL regulation is an important step for consumer protection. Even though checkout at Klarna & Co. may take a bit longer in the future, you benefit from more transparency and better protection rights. For newcomers to Germany especially, it is important to use BNPL services consciously and keep track of your creditworthiness.