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With success comes additional scrutiny. A recent Federal Reserve survey indicates that three-quarters of Americans are familiar with Buy Now Pay Later (BNPL) services, and nearly 10% had accepted such a deferred payment offer in the past 30 days. A modernized take on installment lending for the digital age, BNPL's rapid rise has attracted the attention of lawmakers, regulators, and companies with various stakes in the payments ecosystem.

The landscape of US financial regulation is continually evolving. At the heart of this transformation is the Consumer Financial Protection Bureau (CFPB), an agency tasked with overseeing and enforcing consumer protection laws within the financial sector.

Two recent developments are sending a message to credit card issuers that the regulatory and political winds are not blowing in their favor.

Rohit Chopra, director of the Consumer Financial Protection Bureau (CFPB), on June 22 issued an advance notice of proposed rulemaking to assess if late fees charged by credit card issuers are “reasonable and proportional,” as required by the Credit Card Accountability Responsibility and Disclosure (CARD) Act.

Chopra’s notice came weeks after longtime card industry adversary Sen. Richard Durbin chaired a Judiciary Committee meeting exploring “excessive interchange fees.” While Durbin advocated for reforms, some of his suggestions would set the industry back by decades, likely ending the ability of small banks and credit unions to offer credit cards and directly harming consumers.

Though the outcome is uncertain, the trajectory is clear. Now is the time for a refresher course on the current rules of the road and for issuers to prepare for any potential changes arising during this period of heightened scrutiny.