BNPL services, which includes Afterpay and Zip, have quickly become one of the most popular ways to buy goods and services, particularly amongst young Australian consumers.
It is estimated that there are approximately 20 BNPL services available in the Australian market.
Earlier this week, Financial Services Minister Stephen Jones said the sector could soon face similar oversight measures as credit cards.
"We want innovation, we want people to have access to these great products but we want to ensure that there's proper guardrails in place," Jones said on Today.
“There is a small percentage of the market where people are getting into hot water. We don't want to see people in the same situation they were in the bad old days of the credit market where they might have had five, six, seven, or eight credit cards."
Jones suggested the main measure the government hopes to implement would be credit background checks for users.
According to a recent paper from the Department of the Treasury, there were 7 million active BNPL accounts in the 2021-22 financial year resulting in $AU16 billion in transactions, an increase of more than 35 per cent on the previous financial year.
The Australian Securities and Investment Commission released research earlier this year that found 19 per cent of BNPL users 'cut back' or went without essentials in order to make repayments on time.
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