| dc.description.abstract | In recent years, ＂Buy Now, Pay Later＂ (BNPL) services have surged in popularity. The ＂consume first, pay later＂ model maximizes consumers′ purchasing needs despite their limited payment capacity, effectively narrowing the gap between consumers′ desires and actual financial capability. However, concerns over excessive consumer credit expansion have emerged, exposing the drawbacks of BNPL. Consumers are often exploited by unfair rules designed by service providers. Although BNPL was initially intended to promote Financial
Inclusion, it has inadvertently caused harm to consumers instead.
Observing the global regulatory trends for BNPL, many countries are actively constructing regulatory frameworks. However, under Taiwan′s current legal and regulatory framework,BNPL is governed solely by civil law. Since BNPL operations fall under the jurisdiction of the Ministry of Economic Affairs rather than the Financial Supervisory Commission (FSC), the FSC has merely guided the leasing association to develop self-regulatory guidelines for BNPL.
Nonetheless, existing legal norms and self-regulation are insufficient to address the legal risks arising from BNPL, potentially hindering industry development and raising consumer concerns about BNPL products or services.
This paper draws on the experiences of advanced countries by reviewing and analyzing comparative legal frameworks in the United States, Australia, the European Union, and Malaysia. It advocates for the necessity of BNPL regulation in Taiwan while recognizing the need to localize regulatory practices and evaluate whether foreign legal frameworks can be fully adopted. The paper clarifies the definitional issues surrounding BNPL and introduces Taiwan′s current regulatory landscape and supervisory strategies. From the perspective of credit supervision, it considers the need to establish consumer credit regulations and proposes legal recommendations based on four key pillars: information disclosure, consumer protection, systemic risk management, and financial supervision.
Striking a balance between regulatory stringency and leniency involves navigating the dilemma between ＂financial technology innovation＂ and ＂consumer interests.＂ While service providers pursue financial technology innovation, regulatory authorities must establish comprehensive consumer protection mechanisms without undermining core consumer rights. It is hoped that the regulatory recommendations proposed in this paper will contribute to realizing the positive potential of BNPL in promoting Financial Inclusion. | en_US |