When it comes to finance, compliance isn't just a box to tick. It protects your customers and your reputation as a trusted retailer.
At V12 Retail Finance, we've always taken a proactive, consumer first approach. We work in a fully regulated environment and support our partners with clear guidance, compliant journeys and straightforward answers - without the jargon.
In this blog, we explain the Buy Now, Pay Later (BNPL) regulatory changes coming into effect from 15 July 2026, what they mean for retailers, and how V12 helps you stay compliant as the rules evolve.
The good news? With V12, you're already in safe hands.
For almost 25 years, we've operated in a fully regulated environment. Every product we design, every process we build, and every partner journey we support is shaped around your business and your customers. FCA expectations and good customer outcomes guide our decisions, so when regulations change, you're not starting from scratch.
We've always supported our partners, and we'll continue to do so as regulation evolves.
What is actually changing?
Buy Now, Pay Later is a quick and simple way for customers to spread the cost of a purchase. As it's grown, new rules are being introduced to make sure customers are protected and understand what they're signing up to.
The new rules apply to interest free Buy Now, Pay Later credit, which is repaid in 12 months or less. This type of BNPL will, when the changes come into effect, be called Deferred Payment Credit.
Longer-term finance (over 12 months) was already regulated by the FCA, so that isn't changing; it's this short-term BNPL that's now coming under the new rules.
From 15 July 2026, interest free Buy Now, Pay Later credit repaid within 12 months or less will become regulated and known as Deferred Payment Credit.
These changes don't mean retailers need to be FCA authorised. The FCA authorisation applies to the company that provides the Buy Now, Pay Later credit, not the retailer offering it as a payment option. Retailers can continue to offer new DPC without becoming FCA authorised themselves.
What the changes mean for your customers (in plain English)
From July 2026, Buy Now, Pay Later follows clearer rules to help customers better understand how they're paying and what to expect.
This means customers will see:
• Clearer explanations - they'll know exactly how many payments they're making, when they're due, and how much each one is.
• More transparency upfront - customers can clearly see what happens if they miss a payment, and how refunds or disputes work.
• Simple affordability checks - to help make sure customers aren't taking on payments they can't afford.
• Stronger protections - eligible purchases come with protections under consumer credit rules, giving customers added confidence.
If you partner with us, your customers will already benefit from clear explanations, transparency and affordability checks. We're updating how we present these explanations to reflect new regulations, but aside from some additional protections, the overall experience for customers will remain largely the same.
What this means for you as retailers
For retailers, these changes are about clarity, not complexity.
You should expect your retail finance provider to offer:
• FCA-compliant finance journeys
• Clear, customer-friendly checkout messaging
• A smooth, confident customer experience
Clear journeys build trust, and confident customers are more likely to convert. As a V12 partner, you can expect all of the above as standard. For most V12 partners, this will feel like a continuation, not a disruption.
H2: Jargon busting: authorised vs regulated (what actually matters)
When it comes finance, in the context of providers and products, the terms authorised and regulated can often cause confusion. In relation to the
changes coming into effect, this should help.
FCA authorised
This applies to businesses that are formally authorised by the FCA to provide or arrange credit (like us) or to retailers that are authorised for credit broking to introduce customers to us.
We are directly regulated by the FCA and must meet strict standards around customer protection, clear disclosures, affordability checks, and Consumer Duty good customer outcomes.
Unauthorised
Many retailers are not FCA authorised; that's not unusual.
If you're a retailer introducing customers to V12's finance, you do not need FCA authorisation to work with us.
Even though BNPL will now be regulated as DPC, retailers using this product, still do not need to be FCA authorised, as long as they are not the ones lending the money.
Regulated vs unregulated finance
• Regulated finance refers to the finance product itself being regulated by the FCA.
• From 15th July 2026, BNPL offered through V12 Retail Finance (or any other lender that offers finance where the repayment period is under 12 months) becomes regulated and will be called Deferred Payment Credit.
In simple terms, all finance products offered by V12 Retail Finance, become FCA-regulated and known as Deferred Payment Credit. If you are only offering Deferred Payment Credit for under 12 months duration, you do not need to be authorised by the FCA.
Future proof your business
Working with V12 means we help you stay ahead as new regulatory changes come into force. We take on the heavy lifting, so you can focus on running your business and making sales.
Worth noting: Using a BNPL provider like us doesn't remove a retailer's responsibility to follow FCA regulations. If you're not authorised, any financial promotions you use must be approved by a business that is authorised to approve them.
While we can support with compliant finance journeys and customer protections, retailers remain responsible for how finance is presented and promoted to customers.
In practice, that means:
• Checking how finance is promoted: make sure BNPL messaging on your website, emails and in store clearly explains that finance is optional and subject to approval.
• Using approved wording and assets: stick to compliant wording, disclosures, and, if available, banners provided by your finance partner, and avoid rewriting finance messages without
approval.
• Being clear and upfront with customers: don't hide or downplay important information like credit checks, repayments or customer rights.
• Training staff on the basics: ensure colleagues understand what BNPL is, what they can and can't say, and when to direct customers to the finance provider.
• Keeping records and approvals: keep copies of approved promotions and any compliance sign off, so you can show how decisions were made if needed.
• Reviewing content regularly: regulations and guidance change - checking finance messaging periodically helps make sure it still meets FCA expectations.
In short, a finance provider can help reduce risk and support compliance, but retailers still play a key role in making sure finance is promoted fairly and responsibly.
Why choosing the right finance partner matters
As regulation tightens, the finance partner you choose matters more than ever. You should expect a partner who:
• operates in a fully regulated environment
• guides you clearly through regulatory change
• brings decades of experience supporting retailers of all sizes
That's exactly what V12 delivers.
Why V12 Retail Finance is the ideal partner for growing conversion
V12 Retail Finance is built for retailers who want simplicity, protection, and growth.
We work within FCA rules every day, helping our partners understand regulatory risk while delivering smooth, compliant checkout journeys that support strong conversion.
With V12, you benefit from:
• a fully authorised lender with longstanding FCA expertise
• compliant journeys designed to reduce friction and increase completion
• a dedicated team supporting your setup, promotions, and long-term growth
We help your customers buy with confidence and help you convert more sales by being a trusted, compliant, future-ready finance partner.