The Buy Now, Pay Later (BNPL) Working Group, formed by the Singapore FinTech Association (SFA) and BNPL service providers and operating under the guidance of the Monetary Authority of Singapore (MAS), has prepared a Buy Now, Pay Later Code of Conduct (BNPL Code). The BNPL Code is a set of best practices for BNPL service providers in Singapore on how to protect consumers against excessive debt and to reduce the risk of debt accumulation.
BNPL services consist in extending the time limit for the payment for online purchases, usually by a period from 30 to 60 days. The client does not pay the costs of the deferred payment if they make the payment within the set time limit. If the payment is not made within the set date, the BNPL service provider charges interest or a commission. Sometimes the BNPL service provider also offers, usually against payment, the possibility of further extending the time limit for payment, for example by dividing the payment into instalments.
The BNPL Code of Conduct for Singapore is an expression of self-regulation and commitment of the BNPL industry to compliance with the rules defined in the Code, in particular:
1. As part of BNPL services of a provider, clients will be able to accumulate no more than SGD 2 000 in outstanding payments. Any BNPL purchase above that sum will depend on whether the client passes the credit worthiness assessment, taking into account the client’s income and debt accumulation with other BNPL service providers.
2. If a consumer fails to pay on time, BNPL service providers will suspend the consumer’s access to their BNPL services.
3. Consumers will have the right to make a full repayment of their financial obligations toward a BNPL service provider at any time, without any additional fee for early repayment.
4. The fees related to BNPL services are to be reduced. The method of calculating the fees is to be transparent and clearly communicated to consumers.
5. A BNPL service provider must provide the consumer with access to account statements showing the total balance of purchases made by the consumer through that BNPL service provider.
6. Campaigns promoting BNPL services are to be run in accordance with the applicable codes of conduct regarding advertisement, in an ethical, clear and non-misleading manner.
7. Consumers will have the right to voluntarily exclude themselves from BNPL services and promotional materials concerning such services. The consumer’s statement in this regard will be made in writing. BNPL service providers will be required to keep a list of consumers who have submitted the voluntary statement on the exclusion from the services.
8. BNPL service providers are considering providing assistance to consumers facing financial hardships, for example by setting a repayment schedule which is acceptable to both parties. Over the agreed period, consumers will not be able to execute new transactions using BNPL services. BNPL service providers have also committed not to institute bankruptcy proceedings against their clients.

More information about the BNPL Code of Conduct for Singapore can be found here:
https://singaporefintech.org/buy-now-pay-later-bnpl-working-group-launches-bnpl-code-of-conduct-for-singapore/