Buy Now, Pay Later(BNPL) continues to grow rapidly in Malaysia. In the first half of 2025, BNPL usage surged, with transaction volumes and total spending rising sharply, according to figures presented in Parliament. More Malaysians are turning to BNPL for everyday purchases, from gadgets to groceries.

This trend reflects changing spending habits and growing adoption of digital payment solutions. At the same time, it raises important questions about financial responsibility, consumer awareness, and the need for stronger oversight.

Why BNPL Is Becoming a Preferred Payment Option

BNPL is a short-term financing option that allows users to split the cost of a purchase into smaller instalments, often without interest. This flexibility makes it a popular alternative to traditional credit cards.

One reason for its popularity is convenience. BNPL is usually embedded directly into the checkout process, making it fast and simple to use. The process is typically less restrictive than applying for a credit card, which means more people, including those with limited credit histories, are eligible to use it.

The appeal of interest-free payments and lower entry barriers has contributed to BNPL’s rapid growth, especially among online shoppers and younger consumers looking for budget-friendly payment options.

The Numbers Behind the Growth

BNPL adoption in Malaysia has increased significantly in a short period. In the first half of 2025, the number of BNPL transactions reached 102.6 million, up from 83.8 million in the previous half. The total transaction value rose to RM9.3 billion, marking a 31% increase.

The number of active BNPL accounts also climbed to 6.5 million, compared to 5.1 million at the end of 2024. These figures suggest that BNPL is no longer a niche payment method, but a mainstream part of how Malaysians manage their everyday spending.

While the growth signals strong consumer demand, it has also sparked concern about long-term affordability and the potential for overuse.

The Risks of BNPL

BNPL offers convenience, but it also comes with risks that are sometimes overlooked. Because payments are broken into smaller amounts, it is easy to lose track of how much has been spent in total. This can lead to impulse purchases and difficulty keeping up with repayments, especially when using multiple BNPL services at once.

Missed payments can result in late fees, which may seem small at first but can add up quickly. For individuals without a steady income or those who lack financial planning habits, BNPL can become a source of financial stress rather than a tool for flexibility.

Understanding these risks is important. BNPL may appear simple on the surface, but it still involves a credit commitment that must be managed carefully.

Regulatory Oversight Through the Consumer Credit Act

In response to the fast growth of BNPL and other non-bank credit services, the government has passed the Consumer Credit Act. Approved by the Dewan Rakyat, the Act introduces a new regulatory framework that aims to protect consumers and ensure responsible lending practices.

A key part of the Act is the establishment of the Consumer Credit Oversight Board (CCOB). This body will be responsible for licensing and supervising non-bank credit providers, including BNPL platforms. Its goal is to promote fair and transparent operations while reducing the risk of harm to consumers.

During the second reading of the Bill, Deputy Finance Minister Lim Hui Ying highlighted the potential impact of BNPL on vulnerable users. She pointed out that those with low incomes, unstable employment, or limited financial literacy are particularly at risk if BNPL is misused.

Although the Consumer Credit Act has been passed, it is not yet in force. The provisions will only apply once the Minister of Finance announces the effective date through a gazette notification. The CCOB will also be established in stages, meaning implementation will happen gradually.

Using BNPL Responsibly

BNPL can be useful for managing expenses, but it requires careful planning. Before choosing BNPL, it is important to consider whether the instalments fit within your budget and to understand the terms of the repayment schedule. 

It is also important to keep track of how many BNPL commitments you are managing. While each instalment may seem small, they can add up quickly, especially if spread across multiple purchases. Reviewing your monthly obligations before committing to a BNPL plan can help avoid unexpected financial pressure.

Taking the time to read the terms and conditions, set reminders, and monitor your spending will go a long way in helping you use BNPL effectively without creating unnecessary debt.

Looking Ahead

BNPL is likely to remain a major part of the Malaysian consumer finance landscape. Its flexibility and ease of use have made it a go-to option for many, particularly in e-commerce and lifestyle purchases.

With the passing of the Consumer Credit Act, Malaysia is taking a major step toward regulating the sector and protecting borrowers. Once implemented, the Act will help ensure that BNPL providers operate transparently and that consumers are treated fairly.

As with any financial product, the key to using BNPL successfully lies in awareness and responsibility. Understanding how it works, knowing the risks, and staying in control of your spending can help you benefit from BNPL without jeopardising your financial well-being.

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• TAGS:
• BNPL
• Buy Now Pay Later
• CCA
• CCOB
• Consumer Credit Act
• Consumer Credit Oversight Board