Fintechs Call for Do-Over on New York’s Buy Now, Pay Later Rule

Financial technology companies urged New York’s banking regulator to go back to the drawing board on a proposal that would establish a licensing requirement and cap interest rates on popular buy now, pay later loans.

Many of those provisions—previously designed to protect consumers from hidden costs associated with open-end revolving products such as credit cards—aren’t a good fit for one-time buy now, pay later loans with fixed repayment schedules, the Financial Technology Association said in a comment letter to New York’s Department of Financial Services.

The FTA represents major fintech providers such as Klarna Group PLC and Block Inc., which ...