Debt recovery for Buy Now, Pay Later (BNPL) goods

Falling behind on Buy Now, Pay Later payments

If you have used Buy Now, Pay Later (BNPL) services like Klarna, Clearpay, PayPal, or Laybuy and you are struggling to keep up with payments, you are not alone. BNPL can feel like an easy way to spread the cost, but missed payments can quickly become a bigger problem. The good news is there are things you can do, and we can help.

What happens if you miss BNPL payments

BNPL agreements are credit agreements, even if they did not feel like borrowing at the time. If you fall behind, here is what the provider may do:

• Pass your debt to a collection agency. If you miss payments, your BNPL provider may sell or refer your debt to a debt collection agency. The agency will contact you to chase the money owed.
• Report it to credit bureaus. While some BNPL firms only carry out soft checks when you sign up, missed payments can still be reported to credit reference agencies. This can significantly damage your credit score and make it harder to borrow in the future.
• Take you to court. If the debt stays unpaid, the provider or collection agency can apply for a County Court Judgment (CCJ) against you.
• Send bailiffs. If a court judgment is made and you still do not pay, bailiffs (also called enforcement agents) can be sent to recover the goods or their value.

Continuous payment authorities (CPAs)

When you sign up for BNPL, you often agree to a continuous payment authority (CPA). This gives the company permission to automatically take money from your debit or credit card.

If you do not have enough money in your account when they try to collect, this can push you into your overdraft and lead to extra bank charges.

You have the right to cancel a CPA. Contact your bank and ask them to stop the payments. The BNPL company is not allowed to refuse this. You will still owe the debt, but cancelling the CPA stops money being taken automatically while you sort things out.

What you can do right now

• Stop using BNPL. If you are already behind on payments, avoid taking on new BNPL agreements. Stacking multiple BNPL debts (sometimes called "debt stacking") makes the problem harder to manage.
• Cancel any CPAs you cannot afford. Call your bank and ask them to cancel the continuous payment authority so you are not hit with overdraft fees.
• Contact the BNPL provider. Let them know you are struggling. They may offer a payment plan or a temporary pause on payments.
• Get free debt advice. We can look at the full picture and help you work out what to do next.

Formal debt solutions

If your BNPL debts have become unmanageable, they can be included in formal debt solutions:

• Debt Relief Order (DRO): A way to have your debts written off if you owe less than a set amount and have little income or assets. You can find out more on GOV.UK.
• Individual Voluntary Arrangement (IVA): A formal agreement with your creditors to pay back what you can afford over a set period.

We can help you understand whether either of these options is right for your situation.

Get help

Dealing with BNPL debt can feel stressful, especially if collection agencies are contacting you. You do not have to handle this on your own.

• Email us at info@youthlegal.org.uk
• Call us on 020 3195 1906
• Fill in our contact form and we will get back to you

All our advice is free and confidential.