Financial Services Federation adds Afterpay as new member

Financial Services Federation adds Afterpay as new member | Insurance Business New Zealand

Insurance News

Financial Services Federation adds Afterpay as new member

Membership marks the first engagement with a BNPL service

Insurance News

By
Kenneth Araullo

The Financial Services Federation (FSF), a non-profit association for ethical finance, has welcomed Afterpay, a Buy Now Pay Later (BNPL) provider, into its membership. This addition marks the FSF’s first engagement with a BNPL service.

Operating in New Zealand since 2017, Afterpay is recognised internationally as a significant BNPL service provider. The service, which is free for users who make timely payments, allows consumers to distribute the cost of purchases over a period of six to eight weeks.

In a news release, the FSF said that its executive committee thoroughly reviews membership applications, ensuring compliance with the Credit Contracts and Consumer Finance Act (CCCFA) and a commitment to responsible lending. Afterpay’s membership followed this standard procedure.

In September 2023, the New Zealand government enacted regulations under the CCCFA, specifically tailored for BNPL providers. These regulations aim to balance consumer protection, particularly for vulnerable groups, while ensuring appropriate sector-specific rules.

Lyn McMorran, executive director of the FSF, stated the inclusion of Afterpay enhances the Federation’s collective of responsible lenders. This move is seen as a positive contribution to policy discussions in the non-bank lending sector. McMorran remarked on the alignment of Afterpay’s customer and merchant support approaches with the FSF’s commitment to responsible lending, innovation, and consumer and business support across the nation.

“BNPL is an increasingly popular and valuable payment service in New Zealand. When used responsibly, it helps consumers to manage their budgets while giving retailers of all sizes the opportunity to acquire customers through more flexible payment options,” McMorran said.

McMorran expressed enthusiasm for collaborating with Afterpay and other members to advocate for appropriate regulations and promote responsible lending practices in Aotearoa New Zealand.

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