Bank of Thailand Plans Tighter Rules for Buy Now, Pay Later Services

The Bank of Thailand (BOT) is set to tighten controls on “Buy Now, Pay Later” (BNPL) services in December, introducing measures aimed at addressing rising debt problems and fostering “financial immunity” for the public.

The central bank clarified that the new regulations are not intended to stifle innovation or eliminate this popular form of consumer credit, but rather to keep credit growth within established standards by carefully considering associated risks.

The proposed measures follow rapid growth in BNPL use. A BOT survey of seven major providers found that credit accounts rose by an average of 90% a year, while credit amounts increased by 88% annually. Providers issued 22 billion baht across 4.23 million accounts in 2024, rising to 48 billion baht across 8.15 million accounts last year. In the first half of this year, credit reached 57 billion baht across 11 million accounts.

Rapid Growth Raises Concerns

According to the BOT, BNPL services have experienced explosive growth, reflecting a significant shift in consumer behavior and increasing risks for users, particularly younger generations and “fragile” demographic groups who may accumulate unmanageable debt.

Under the proposed rules, BNPL users must be over 20, credit limits cannot exceed 20,000 baht, and repayment must be completed within six months. Combined interest, penalties and fees would be capped at 15% per year. Credit lines could not be converted to cash or digital money, withdrawn, or transferred to other credit accounts.

A survey of seven major BNPL providers revealed alarming statistics:

• The number of credit accounts has surged by 90% annually
• The total credit amount has grown by an average of 88% per annum

Credit Growth Timeline:

• 2024: 22 billion baht across 4.23 million accounts
• 2025: 48 billion baht across 8.15 million accounts
• First half of 2026: 57 billion baht across 11 million accounts

Five Key Regulatory Measures

The BOT has introduced five new measures to regulate BNPL services and has invited public feedback:

1. Age Requirement: BNPL users must be over 20 years old
2. Credit Limits: Credit lines must not exceed 20,000 baht with repayment within six months
3. Interest Rate Cap: Combined interest rates, fines, and fees must not exceed 15% per annum
4. No Cash Conversion: Credit lines cannot be exchanged for cash, digital money, withdrawn, or transferred to other credit accounts
5. Fair Repayment Practices: Service providers must exercise fairness in collections and clearly display amounts owed and interest due

By bringing BNPL under the regulatory framework, the BOT aims to screen risks and prevent debt problems from the start, protecting consumers while allowing the financial service to develop responsibly.

BOT Governor Vitai Ratanakorn said BNPL had expanded faster than personal loans and credit cards, with some consumers using it for everyday purchases. He warned that, without appropriate oversight, easy access to credit could contribute to mounting debt, particularly among younger and financially vulnerable users.

Providers would also be required to use fair repayment practices and clearly disclose the outstanding balance and interest owed. The BOT said the measures are intended to screen for risk and prevent debt problems, rather than restrict financial innovation. It has invited the public to comment on the proposals.