§ 746 — Consumer protections

* § 746. Consumer protections. 1. A buy-now-pay-later lender shall\ndisclose or cause to be disclosed to consumers the terms of\nbuy-now-pay-later loans, including, without limitation, the cost, such\nas interest and fees, repayment schedule, the means by which a consumer\nmay dispute billing practices, whether the transaction will or will not\nbe reported to a credit reporting agency, and other material conditions,\nin a clear and conspicuous manner. Disclosures shall comply with\napplicable federal regulations, including but not limited to regulation\nZ of title I of the Consumer Credit Protection Act.\n 2. Subject to regulations to be promulgated by the superintendent, a\nbuy-now-pay-later lender shall, before providing or causing to be\nprovided a buy-now-pay-later loan to a consumer, perform, or cause to be\nperformed, reasonable risk-based underwriting. A buy-now-pay-later\nlender shall maintain or cause to be maintained policies and procedures\nfor underwriting buy-now-pay-later loans, and shall disclose factors\nconsidered in such underwriting process, in a clear and conspicuous\nmanner to the consumer. No buy-now-pay-later lender shall collect,\nevaluate, report, or maintain in the file on a borrower the credit\nworthiness, credit standing, or credit capacity of members of the\nborrower's social network for purposes of determining the credit\nworthiness of the borrower; the average credit worthiness, credit\nstanding, or credit capacity of members of the borrower's social\nnetwork; or any group score that is not the borrower's own credit\nworthiness, credit standing, or credit capacity.\n 3. A buy-now-pay-later lender shall maintain or cause to be maintained\npolicies and procedures for maintaining accurate data that may be\nreported to credit reporting agencies. No buy-now-pay-later lender shall\nshare consumer data in a manner inconsistent with this article and\nregulations promulgated thereto.\n 4. A buy-now-pay-later lender shall provide or cause to be provided\nrefunds or credits for goods or services purchased in connection with a\nbuy-now-pay-later loan, if the consumer requests and is entitled to a\nrefund, in a manner that is fair, transparent, and not unduly burdensome\nto consumers. A buy-now-pay-later lender shall maintain or cause to be\nmaintained policies and procedures to provide such refunds or credits.\nSuch policies and procedures shall be fair, transparent, and not unduly\nburdensome to the consumer. A buy-now-pay-later lender shall disclose or\ncause to be disclosed to consumers, in a clear and conspicuous manner,\nthe process by which they can obtain refunds or credits for goods or\nservices they have purchased in connection with a buy-now-pay-later\nloan.\n 5. A buy-now-pay-later lender shall resolve or cause to be resolved\ndisputes in a manner that is fair and transparent to consumers. A\nbuy-now-pay-later lender shall create or cause to be created a readily\navailable and prominently disclosed method for consumers to bring a\ndispute to the buy-now-pay-later lender. A buy-now-pay-later lender\nshall maintain policies and procedures for handling consumer disputes.\nThe superintendent may promulgate rules and regulations regarding\ntreatment of unauthorized use, so that consumers are liable for use of\nbuy-now-pay-later loans in their name only under circumstances where\nsuch liability would be fair and reasonable. A buy-now-pay-later lender\nshall apply to buy-now-pay-later loans the dispute rights and\nunauthorized charges requirements that apply to credit cards under the\nTruth in Lending Act, 15 U.S.C. § 1643, 1666, 1666a, 1666i, regardless\nof whether such law applies to buy-now-pay-later loans or whether the\nbuy-now-pay-later lender offers a credit card within the scope of such\nlaw.\n 6. A buy-now-pay-later lender may use, sell, or share the data of a\nconsumer, other than in connection with the making of a particular\nbuy-now-pay-later loan to the consumer, only with the consumer's\nconsent. A buy-now-pay-later lender shall disclose or cause to be\ndisclosed to a consumer in a clear and conspicuous manner how such\nconsumer's data may be used, shared, or sold by the buy-now-pay-later\nlender before obtaining such consumer's consent and also shall disclose\nor cause to be disclosed to such consumer in a clear and conspicuous\nmanner how such consumer may subsequently withdraw consent to such use,\nsharing, or sale. The superintendent, in their discretion, may by\nregulation prohibit certain uses of consumer data. A buy-now-pay-later\nlender shall maintain policies and procedures regarding its use, sale,\nand sharing of consumers' data. Nothing in this subdivision shall\npreclude a buy-now-pay-later lender from using information in accordance\nwith the Fair Credit Reporting Act or furnishing credit reporting data\nto a credit reporting agency.\n 7. Any buy-now-pay-later loan made by a person not licensed or\nauthorized under this article, other than an exempt organization, shall\nbe void, and such person shall have no right to collect or receive any\nprincipal, interest or charge whatsoever.\n 8. Nothing in this section shall be construed to limit the obligations\nof a buy-now-pay-later lender to comply with any other applicable laws\nor regulations. Any protections, rights and remedies provided in this\nsection to a consumer with respect to an agreement with a\nbuy-now-pay-later lender shall be intended to supplement and not be\nexclusive of any protections, rights and remedies otherwise available\npursuant to any other law or regulations.\n * NB Effective upon the one hundred eightieth day after the\npromulgation of rules and/or regulations by the department of financial\nservices to effectuate certain provisions (see Ch. 58 of 2025, Part Y, §\n13)\n