The American Fintech Council (AFC) has submitted a formal comment letter to Oregon’s Division of Financial Regulation, pushing back against a proposed bulletin that would bring buy-now-pay-later products under the state’s existing payday lending and consumer finance licensing framework. The AFC argues the approach conflates two fundamentally different credit structures and calls for a bespoke rulemaking process before any new compliance obligations are imposed.
The proposed bulletin, issued by the Oregon Department of Consumer and Business Services, would extend the state’s payday and consumer finance licensing requirements to BNPL providers operating in Oregon. The AFC contends that regulations designed for high-cost, open-ended payday credit are ill-suited to point-of-sale instalment products that carry fixed repayment schedules and, in most cases, zero interest for the consumer.
The AFC’s core arguments
The council raises three substantive objections. First, it argues that merchant compensation arrangements, the fees BNPL providers collect from retailers, should not be classified as consumer finance charges, since they are payments for processing and distribution services rather than interest on credit extended to consumers. Regulators in other jurisdictions have generally accepted this distinction, though it remains contested and is the subject of ongoing federal debate.
Second, the AFC challenges the Division’s interpretation of the purchase money loan exclusion, contending that BNPL products finance specific retail transactions at the point of sale and should therefore be evaluated on their transaction-specific structure rather than on whether they are collateral-secured.
Third, and perhaps most consequential for industry, the AFC warns that issuing a regulatory bulletin rather than pursuing formal rulemaking bypasses the transparent, stakeholder-driven process it says is warranted for what amounts to a substantial expansion of licensing obligations.
Phil Goldfeder, chief executive of the AFC, said pay-over-time options provide consumers with clear terms and predictable repayment schedules as an alternative to traditional credit. Ian P. Moloney, the AFC’s chief policy officer, argued that Oregon’s approach should reflect the inherently distinct structure of BNPL before new obligations are imposed.
Regulatory read-across
Oregon’s proposed bulletin sits within a broader pattern of state-level BNPL scrutiny that has accelerated since the Consumer Financial Protection Bureau‘s 2024 interpretive rule classifying certain BNPL products as credit cards under the Truth in Lending Act. That federal move pushed BNPL providers toward greater disclosure obligations nationally, and several states have since moved to layer on their own licensing requirements.
The AFC’s intervention reflects a wider industry strategy: engage early in state rulemaking to shape the framing before obligations crystallise. For BNPL providers active in Oregon, the immediate risk is dual licensing exposure if the bulletin proceeds as drafted. The longer-term risk is regulatory fragmentation across US states, each applying different licensing thresholds to products that operate on a broadly consistent economic model.
The Division of Financial Regulation has not publicly responded to the AFC letter. The council’s preferred outcome is a formal rulemaking process with a defined comment period, which would give the industry a more durable and legally defensible framework to plan around.
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