Burnley businessman Dave Fishwick has praised the new rules and regulations to the 'buy now, pay later' - and says he spoke to a person from Burnley who used one to buy a Big Mac.
Speaking on Good Morning Britain, Dave Fishwick discussed the dangers of the scheme and what changes have been brought in to protect consumers.
Dave, whose real-life battle with the banks, inspired two Netflix films, said: "There have been lots of issues with buy now, pay later schemes, they have been unregulated for a very long time.
"There have been no proper affordability checks, no proper job checks, there has been little visibility across the platforms allowing people to take out multiples of these loans.
"If you want to buy something you have to check you can afford it."
Dave said he has been campaigning for more regulations for some time, adding that he met a person, from Burnley, who used the loan to buy a Big Mac from McDonald's.
Dave said: "I have been going out there and campaigning for these regulations for these companies for a very long time.
"Up until today, they were unregulated.
"People were taking out unregulated loans.
"I met someone yesterday who was buying a Big Mac with one, up in Burnley – and that is wrong."
While he acknowledged how the scheme can be useful, he urged people only to buy things they can afford.
He said: "People do use these things in a proper way…there are certain times of year these things are really handy but you need to make sure you can afford it in the first place.
"I have met some people where a few hundred pounds turns to thousands.
"Only buy things you need."
On July 15, BNPL lenders such as Klarna and Clearpay came under Financial Conduct Authority (FCA) regulation, which means they now must carry out affordability checks, provide clearer information about repayments, and offer more support to customers who fall into financial difficulty.
Customers can now also take complaints to the Financial Ombudsman Service if they are unhappy with how a provider has handled their agreement.
A spokesperson for the FCA said: "Buy now, pay later can be a form of credit, but people deserve to be protected when using it.
"Lenders should check their customers can afford to pay it back."
The changes mean some BNPL borrowing may now appear on credit reports and could affect applications for loans, credit cards, or mortgages.
Dimitar Lazarov, head of Credit Karma UK, said: "It could have an impact on their ability to apply for other products."
Consumer finance experts have pointed out that one of the dangers of BNPL schemes is that they normalise borrowing for everyday purchases.
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Sarah Coles, head of personal finance at AJ Bell, said: "The Woolard Review, done by the FCA in 2021, showed that people often didn't think of it as borrowing either.
"A combination of both things means borrowers don't consider affordability as carefully as they would for other kinds of debt.
"It means a real risk of stacking these debts until they're unwieldy."
Vikki Brownridge, chief executive at StepChange Debt Charity, said: "If you are finding yourself struggling to keep up with payments, rather than taking on more credit or BNPL agreements, we would always advise seeking free and impartial debt advice to help get back on track."
Free debt advice is available from StepChange, Citizens Advice, National Debtline, and Christians Against Poverty.
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