BNPL: ten days until the door opens

The Temporary Permissions Regime (TPR) for deferred payment credit firms opens on 15 May 2026, and there is no time to lose. Regulation day follows on 15 July. Firms that haven't either entered the TPR or secured full FCA authorisation will be unable to enter new BNPL agreements after that date.

The market has grown from roughly £60 million in 2017 to more than £13 billion in 2024. From 15 July, third-party deferred payment credit lending — where the lender and the merchant are not the same person — operates inside the FCA perimeter. 

Here is how we are helping clients think about the next three months.

TPR or direct authorisation?

The TPR is a notification-based route. Firms register, give the FCA the information it needs to know who is in the regime, and continue trading while their full authorisation application is processed. It is the pragmatic path for most firms that want to keep new business flowing past 15 July.

To be eligible for the TPR, a firm must have been carrying on a deferred payment credit activity on 15 July 2025, when the Government's legislation initially commenced. Firms that began DPC activity after that date cannot use the TPR and will need to secure full authorisation directly. 

Full authorisation directly is the alternative. It is a longer process, but the destination is the same: an FCA-authorised firm with permanent permissions.

Most firms we are working with will use the TPR as a bridge to authorisation rather than a long-term home. The TPR is a runway, not a parking space.

The choice depends on a few things: how mature your compliance framework is today, how confident you are in your affordability and Consumer Duty processes, and how stable your business model is. Firms with newer or evolving products may find TPR gives them useful breathing room. Firms with an established model and strong governance may prefer to go straight to authorisation.

The thing to avoid is delay. The TPR notification window opens on 15 May and closes on 1 July 2026. Firms that miss it cannot trade new agreements while their application sits in the queue. 

What is in scope from day one.

Several obligations apply immediately when regulation begins, regardless of whether you are in the TPR or

full authorisation:

The Consumer Duty applies in full. The four outcomes (the governance of products and services, price and value, consumer understanding, and consumer support) apply to BNPL exactly as they do to any other regulated consumer credit product. Cross-cutting rules on acting in good faith, avoiding foreseeable harm, and enabling and supporting customers to pursue their financial objectives sit alongside. 

Affordability and creditworthiness assessments are required, and proportionate to the size and nature of the lending. The FCA has been clear that "outcomes-focused" does not mean "rules-light". The rules are flexible. The outcomes expectation is firm.

Forbearance and customer support. Firms must be able to identify customers in financial difficulty and respond appropriately. For many BNPL firms this is a more developed obligation than they may be used to.

Information and disclosure obligations. Pre-contract information must be clear, fair and not misleading.

What to do this week

Three priorities for the next seven days.

• Decide your authorisation route. Make the TPR or direct authorisation decision and document the rationale. The TPR notification will need to be ready to submit on 15 May.

  
  
  
  

• Stress-test your affordability framework against the final rules. Check whether the data you collect, the decisions you make, and the records you keep meet the proportionality expectation.

  
  

• Map customer journeys against Consumer Duty cross-cutting rules. Identify the points where customers might experience harm, and the controls that prevent it.

  
  

A note on process and timeline

Regulation day on 15 July is firm. The TPR notification window opens on 15 May and closes on 1 July 2026. Firms that successfully enter the TPR can continue to enter new BNPL agreements while their full authorisation application is reviewed.

Adempi expects the FCA's authorisations team to be busy through the back half of 2026. Firms with clean, complete applications are likely to be processed faster. Application quality is the controllable variable here.

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Adempi advises consumer credit firms on FCA authorisation, Consumer Duty, and product governance. Get in touch if you'd like to explore how the BNPL TPR fits into your plan.

You can reach us at contact@adempi.co.uk or on 0203 925 4761 

Or find out more about our services from the website: Adempi - FCA Compliance Consultants.