Comment to Illinois Department of Financial and Professional Regulation on Regulations Under BNPL Act

August 28, 2026 — Comments

NCLC submitted comments on the proposed regulations by the Illinois Department of Financial and Professional Regulation under the Buy Now Pay Later Act. The comments support the proposed regulations, which implement the important protections of the BNPL Act and will help ensure that BNPL loans are offered in a fair, safe, transparent and affordable manner.

The comments also suggest important improvements needed in the regulations. Most critically, the $8 per loan late fee limit is far too high. Late fees should be limited to $8 per month in total, for all purchases, consistent with the amount that the Consumer Financial Protection Bureau (CFPB) found was reasonable for credit cards. Allowing $8 per loan could result in up to $88 a month in late fees for consumers who use BNPL pay-in-four loans every week.

The comments also recommended other improvements:

• The underwriting section should require lenders to assess the borrower’s income and obligations.
• The regulations should restate the requirement to comply with the rate cap of the Predatory Loan Prevention Act and should prevent subscription fees and other fees seen on BNPL loans from evading that rate cap.
• The regulations do not address re-submission of bounced payments and should codify the protections in the statute.
• The dispute protections should include the ability to assert claims and defenses that the consumer has against the seller if they do not get what they paid for, and consumers should not have to bear up to $50 in unauthorized charges.
• Disclosures should automatically be provided to all consumers in Spanish as well as English.
• The regulations do not address privacy protections. Those protections should be added and, to the extent possible, be modeled after the New York protections.
• Lender’s annual reports should be public, and IDFPR should publish its own annual report summarizing the lenders’ reports and market trends.
• IDFPR should establish an ombudsman for BNPL complaints.

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