As of 10 June 2025, significant new regulations have been introduced in Australia impacting Buy Now Pay Later (BNPL) services — including AfterPay, one of the most popular payment gateways for eCommerce brands. Whether you’re running a fashion label, a furniture business, or a custom dropshipping store, these changes may affect your customers, conversion rates, and payment systems.

At Digital One Agency, we work with businesses across Australia, the UK, and the US to build, optimise, and scale eCommerce platforms. That includes making sure your tech stack — from payments to CRMs — is always compliant and conversion-ready.

In this guide, we break down exactly what’s changing with AfterPay, what it means for your business, and what you can do next.

Why BNPL Matters More Than Ever

BNPL services have exploded in popularity in Australia over the last five years, with AfterPay leading the charge. These services allow customers to split payments into instalments without interest, creating lower friction at checkout and increasing average order values.

🧾 According to the Reserve Bank of Australia, BNPL payments totalled over $19 billion in 2022–23, making up nearly 2% of all card transactions.

But as usage has grown, so has scrutiny. Regulators are now stepping in to ensure responsible lending, reduce consumer harm, and bring BNPL providers into line with traditional credit providers — all under new legislation.

🔍 Summary of the New BNPL Regulations (Effective 10 June 2025)

BNPL is Now Classified as Low-Cost Credit

Under the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Act 2024 and the National Consumer Credit Protection Amendment (Low Cost Credit) Regulations 2025, AfterPay and similar services are now regulated as low-cost credit contracts (LCCCs).

This means they’re treated much more like credit cards than casual payment plans.

Major Regulatory Changes That Affect AfterPay:

🎯 Key Implications for Ecommerce Store Owners

While these new regulations are aimed at providers like AfterPay, there are several flow-on effects that brand owners need to be aware of:

1. Slower Customer Approvals

Customers may now be subject to credit and affordability checks before being approved for AfterPay. This could slow down the checkout process or reduce approval rates — particularly for high-ticket items.

Tip: Consider offering alternative payment options (like Zip, Klarna, or Humm) to avoid basket abandonment.

2. Customer Disputes and Hardship Requests

New protections allow customers to lodge hardship requests or disputes through the Australian Financial Complaints Authority (AFCA). While AfterPay will handle these cases, your support team may still be contacted.

Recommendation: Update your customer support workflows and FAQ content to reflect the new dispute pathways.

3. Reduced Risk of Late Fee Complaints

With strict caps on late fees, customers are less likely to feel “trapped” by repayments — which can reduce negative reviews and chargebacks. However, this also limits AfterPay’s ability to be flexible with high-risk consumers.

Impact: You may see fewer high-risk users using BNPL, changing your customer mix slightly.

🛠️ How Digital One Agency Helps You Stay Compliant and Profitable

Our team at Digital One Agency doesn’t just build eCommerce websites — we futureproof them. We’ll help you:

✅ Audit and update your AfterPay or BNPL integrations to ensure they’re still working under the new regime
✅ Offer alternative payment gateways to give customers more flexible options
✅ Optimise your checkout UX so new credit checks don’t slow down conversions
✅ Train your customer support staff with updated FAQs and chatbot flows
✅ Stay ahead of further regulation changes via our monthly client updates and analytics dashboard

🔧 Practical To-Do List for Ecommerce Operators

Here’s what we recommend doing immediately:

1. Contact AfterPay to confirm their ACL status and readiness under the new rules
2. Review your checkout page for messaging that may need updating (e.g. “Instant Approval” may no longer be valid)
3. Add additional BNPL providers or split-payment methods in case AfterPay approval rates fall
4. Update your T&Cs and Privacy Policy to reflect new credit reporting practices
5. Talk to us at Digital One Agency — we’ll help you build a payment system that stays compliant and performs under pressure

Final Thoughts: BNPL Isn’t Going Anywhere — But It’s Growing Up

These new AfterPay regulations are part of a global trend to clean up the wild west of BNPL. While it may cause some short-term friction, the long-term outcome is more trust, more clarity, and a more sustainable eCommerce environment.

At Digital One Agency, we see regulation as an opportunity — not a burden. It’s your chance to stand out with a compliant, secure, and user-friendly store that outperforms your competition.

📞 Ready to Optimise Your eCommerce Business?

Let’s futureproof your checkout, boost your sales, and turn compliance into conversions.

📧 Email: contact@digitaloneagency.com.au
📞 Local (Sydney): (02) 9057 9079
🌍 International: +61 2 9057 9079

Digital One Agency – High-converting websites. Payment integrations. Done for you.