Buy now pay later (BNPL) and payday loans are easy to start and easy to underestimate. Used carelessly, they can quietly trip up your next loan application. Here's what's really going on, plus what changed in Australian law in 2025.
When you apply for finance, a lender checks whether you can afford the repayments. They look at your regular commitments, and that includes your BNPL instalments and any short-term loans. A handful of active BNPL accounts can shrink how much you're allowed to borrow, even if each one feels tiny. Payday loans can raise a bigger flag, because regular use can suggest you're stretched.
The OAIC even suggests closing BNPL accounts you no longer use, pointing out that juggling lots of lines of credit makes repayments harder to manage.
For a long time BNPL sat outside Australia's main credit laws. That's changed. From 10 June 2025, BNPL products are regulated as credit. This came in through the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Act 2024, which brought BNPL under the National Credit Code.
According to ASIC and AFCA, it means BNPL providers now have to:
The upside for you, as AFCA explains, is free, independent help if something goes wrong with a BNPL provider.
Part of getting finance-ready is untangling these smaller commitments so a lender sees a clean, manageable picture. Our education program covers exactly this, how everyday credit products affect your approval, and we're partnered with Ausloans Finance Group and Drive Approved to help when you're ready to apply.
Not sure how your BNPL or short-term loans are affecting you? Book a free, no-obligation assessment.
General advice warning: This article is general information only. It doesn't take your personal circumstances, objectives or needs into account, so consider your own situation and seek professional advice before making financial decisions. Perfect Score Pty Ltd | Australian Credit Licence 562270 | AFCA member.