2 February 2024 - ASIC accepts court enforceable undertaking from buy now, pay later provider Elepay

ASIC has accepted a court enforceable undertaking from buy now, pay later provider Elevare Pay Easy Pty Ltd, trading as Elepay.

Elepay’s products are financial products under the Design and Distribution Obligations (DDO) of the Corporations Act which requires Elepay to make a Target Market Determination (TMD) before offering them to consumers.

TMDs ensure that products are only sold to consumers in the target market for that product and that the product is appropriate to their needs and objectives.

Although buy now, pay later products are not considered credit products, they must comply with the DDO.

The DDO commenced on 5 October 2021. They require issuers and distributors to take a consumer-centric approach by placing consumer outcomes front and centre at the product design, product distribution, and monitoring and review stages of the product life cycle.

The Corporations Act extends the definition of ‘financial product’ for the purpose of the DDO to include a ‘financial product’ within the meaning of the ASIC Act, which includes a ‘credit facility’.