KUALA LUMPUR: Buy Now, Pay Later (BNPL) schemes have experienced a significant rise, with 102.6 million transactions valued at RM9.3bil recorded in the first half of 2025, says Finance Minister II Datuk Seri Amir Hamzah Azizan.
He added that this is a 31% increase compared to RM7.1bil in the second half of 2024.
Despite this increase, he said the situation remains under control, with outstanding or overdue payments amounting to RM121.8mil, which is just 3.2% of total BNPL loans.
“As of June 30 2025, the total outstanding BNPL loans stood at RM3.8bil, which represents only around 0.2% of overall household debt in Malaysia. So, for now, I believe BNPL remains manageable,” he said in response to a question from Young Syefura Othman (Pakatan-Bentong) on Monday (Aug 4).
Young Syefura raised concerns about younger Malaysians falling into unmanageable debt.
Amir added that oversight of the sector would be strengthened under the Consumer Credit Act 2025, which will regulate non-bank credit providers, including BNPL operators.
Under the new legislation, BNPL providers will be required to adhere to responsible lending standards, which include affordability assessments, fair terms of engagement, transparent and reasonable charges, and ethical debt collection practices.
“These measures are crucial to ensure that borrowers—especially youths—are not pushed into financial distress and debt traps,” Amir said.
On July 21, the Dewan Rakyat passed the Consumer Credit Bill 2025 to address concerns about the rise of buy-now-pay-later schemes. This new legislation aims to regulate non-bank credit and credit service providers by establishing a statutory body, the Consumer Credit Commission (CCC).
Amir said the newly established Consumer Credit Commission will be responsible for monitoring BNPL companies' compliance with these standards. Should any operator fail to meet the requirements and cause harm to consumers, the CCC will be empowered to take enforcement actions ranging from administrative penalties to civil and criminal proceedings.
He mentioned that BNPL companies will also be required to meet licensing standards, which include sound governance, fitness and propriety of board members and senior management, and minimum financial requirements.
Beyond regulatory measures, he emphasised the importance of financial literacy.
“We must ensure the public is financially savvy and aware of the risks of excessive use of BNPL schemes,” he said, noting that the Consumer Credit Oversight Board Task Force is actively monitoring developments across credit sectors in preparation for full regulation under the CCC.
The issue of interest charges imposed by BNPL providers is also under review. While most charge 1.5% per month or 18% annually, industry-wide rates range from 15% to 30% per year, with some providers charging no interest at all.
The CCC is currently collecting detailed data to assess consumer indebtedness and operational costs across the industry to support proportionate and balanced rule-making.
“These regulatory moves will create a framework that ensures greater transparency, fairness, and consumer protection in Malaysia’s rapidly growing BNPL sector,” he added.
