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CBA boss expects rules for pay later firms

Commonwealth Bank boss Matt Comyn expects scrutiny and regulatory concerns to increase for buy now, pay later providers, despite authorities declining to impose conditions on the credit providers.

Mr Comyn on Thursday remained convinced that the likes of Afterpay, Splitit and Zip, which tend to charge late payment fees rather than interest, will eventually face tighter controls.

“I don’t think the focus and scrutiny is going to go away,” Mr Comyn said in response to a question at a media briefing.

“If anything, it is going to increase, but I think there will be clearly divergent views for some time about the need for regulation and when that will most likely come into effect.”

Buy now, pay later providers are popular among young people, many of whom have preferred them to bank credit cards.

The Australian Securities and Investments Commission last year found purchases using the new wave of services climbed 90 per cent in 12 months. One in five users missed payments. This usually results in being charged a fee.

Yet the regulator opted not to impose additional rules.

Mr Comyn said regulators and policy makers wanted to ensure innovation in financial services, so regulation tended to lag in emerging areas.

“I think the same sorts of issues are being contemplated internationally by many other countries,” he said.

The Commonwealth Bank last year bought a stake in buy now, pay later provider Klarna, developed in Sweden.

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