Buy now pay later spending in Australia grew just $1.5 billion in 2025, down from $3 billion annual growth in the late 2010s, as new credit regulations and slowing customer acquisition reshape the sector, the Reserve Bank reports.

New BNPL account applications fell 35% in the three months to June 2026 from a year earlier, according to credit agency Equifax. At least eight platforms have exited Australia since 2022, leaving four major operators: Afterpay with 4.5 million customers, and PayPal, Klarna and Zip with about 2 million each. Zip will leave New Zealand on Monday.

The slowdown follows 2025 laws that required BNPL companies to perform credit checks and report accounts to credit agencies, removing the instant approvals that were their main draw. "Once it became more regulated and had more friction, then I think people changed," said Kevin James, analyst at Equifax. Australians spent 20 times more on credit cards than BNPL last year, Luca Ittimani reports for Guardian business.