What: The Council of the European Union has voted for revised legislation to strengthen the framework for split and deferred payments.

Why it is important: Concerns have been raised about the potential impact on interest-free short-term credits, which may face the same regulatory burden as long-term credit.

This legislation aims to regulate credits of less than EUR 200 and Buy Now Pay Later offers, which have seen significant growth in recent years, especially among younger consumers. Service providers offering these credits will be required to clearly present the total cost of repayment and ensure that customers are able to repay their loans. Consumers will also have a 14-day period to cancel their credit.

The revised legislation also includes stricter rules on advertising to reduce abusive credits and measures against overbilling.

The European Union will strengthen the framework for split and deferred payments