Preparing to implement the revised Credit Consumer Directive (CCD).
BNPL has been widely discussed within the Dutch House of Representatives in the last few years. During these discussions, the possibility of national legislation has also been discussed. In a report of a consultation in the House of Representatives from 12 June 2023, the Minister of Legal Protection provided an answer to the question on the necessity of national legislation on BNPL in The Netherlands. According to the Minister, national legislation would have little effect as it would not apply in the case a Dutch citizen buys a product from a foreign web shop using BNPL. In October 2024, the Dutch parliament unanimously passed a motion to prohibit BNPL in brick-and-mortar shops, but so far this motion has no legal significance since the government has not passed legislation to regulate BNPL. In January 2025, the Minister has announced that he has asked BNPL-providers not to introduce BNPL in brick-and-mortar shops bus this request does not have legal force. A ban on BNPL is not considered by the Minister since such ban would not be sustainable considering the implementation of the revised CCD.
BNPL is currently excluded from consumer credit regulation as laid down in the Dutch Financial Supervision Act (FS”) (which relates to the authorisation of credit providers and credit intermediaries and rules of conduct) and the Dutch Civil Code (DCC) (which relates to the civil aspects of consumer credit agreements). BNPL providers are excluded of the consumer credit regime under the FSA (article 1:20 (1) (e) FSA) and DCC (article 7:85 (2) (e) DCC) considering that credit relating to BNPL has to be repaid within three months and only insignificant costs are charged. Accordingly, BNPL providers in the Netherlands are not subject to authorisation and therefore do not have to adhere to rules of conduct, such as a creditworthiness test, nor are BNPL products registered in the Central Credit Information System of the Dutch Credit Registration Bureau.
Also note that in October 2024, there was a judgment (Case C 409/23) in which the Court of Justice of the European Union (CJEU) answered several preliminary questions of the Dutch Supreme Court on amongst others the possible qualification of BNPL as a consumer credit agreement within the meaning of title 2A of book 7 of the Civil Code. In the judgement it became clear that BNPL-providers cannot benefit from the exception in the CDD for credit agreements where credit is free of interest and without any other charges and is repaid within three months (art. 2(2)(f)) if the creditor ‘anticipates’ non-performance by the consumer in order to seek a financial advantage. It is now up to the Dutch Supreme Court to interpret and apply this answer of the CJEU.
In December 2022, the European Council, the European Commission and the European Parliament reached a preliminary political agreement on the revision of the CCD. Part of the agreement is that BNPL will fall under the scope of the CCD, which will better protect consumers using BNPL services. In practice this means that BNPL providers will have to comply with rules on disclosures and advertising and will have to perform a creditworthiness check. Moreover, the maximum credit fee will then also apply. The CCD was signed in October 2023 (Directive 2023/2225). The revised CCD needs to be implemented into national legislation by 20 November 2025 and needs to be applied by 20 November 2026.
We do not yet know the outline of the law implementing the CCD into Dutch law, but the Minister has announced that this law will include an article on age-verification meaning that age-verification will be a legal obligation for BNPL providers and that providing a credit to a minor will be prohibited. The Minister has expressed the intention to implement the revised CCD expeditiously.
As explained, the scope of application of the CCD will be extended to BNPL providers, meaning that a comprehensive legal framework will become applicable. For BNPL providers not yet authorised to offer credit in the Netherlands, this will likely result in the obligation to obtain appropriate authorisation to legally do so. This also implies that BNPL providers will have to thoroughly review their business and revenue models, and the costs incurred in doing so. In principle, consumers' creditworthiness will have to be checked. Thus, information on the consumer's financial position and identity will have to be obtained, and the consumer will have to receive sufficient pre-contractual information to assess whether the credit is suitable for the consumer and the consumer's wishes. This is impactful for BNPL providers as it is precisely the speed and ease with which BNPL can now be used that makes it so valuable.
It is however proposed to provide for possibilities for proportional application of certain rules for specific credits at national level (relating to advertisement, precontractual information and contractual information). This would apply to credit agreements with a credit amount below €200; where the credit is granted free of interest and without any other charges; and where credits must be repaid within three months and where only insignificant fees are charged. The reason for this proposal is to avoid an overload of information for the consumer and excessive administrative burden for the creditor.
The extra paperwork and costs do not only affect the BNPL providers, also e-commerce offering this payment method will face regulation. As their work involves credit intermediation, this is in principle subject to licensing requirements. However, the revised CCD foresees the following exception: "Member States may decide not to apply admission and registration requirements as referred to in paragraph 1 to suppliers of goods or providers of services who qualify as micro, small and medium-sized enterprises as defined in Recommendation 2003/361/EC, acting as: (a) credit intermediaries in an ancillary capacity; or (b) creditors in an ancillary capacity, granting credit in the form of deferred payment to purchase goods and services offered by them, if the credit is provided free of interest and with only limited charges payable by the consumer for late payments imposed in accordance with national law.”
Therefore, it depends on the position of the Dutch government whether the revised CCD has a significant effect on merchants offering their customers the possibility to purchase goods and services with BNPL. However, considering the attitude of the House of Parliament vias-a-vis BNPL, it is likely that for large merchants additional regulations (including an authorisation obligation) will apply to offer their customers the possibility to purchase goods and services with BNPL.
In relation to the consumers, all these changes will most likely have a negative effect on their purchasing process when using BNPL. Especially consumers in a financially unstable situation might be deterred from using this method as they will have to undergo age verification and financial background checks, which prevents them from taking on further debts.
