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The ultimate fate of the Consumer Financial Protection Bureau (CFPB) has yet to be settled, but the past few weeks have seen the CFPB rescind several orders and rules aimed at banks and FinTechs.For buy now, pay later (BNPL) providers, an interpretive rule classifying BNPL firms that provide pay-in-four options as credit providers is on its way to being dropped. The rule mandated that consumers using BNPL must be afforded the same legal protections that are tied to credit cards, as covered under Regulation Z. We noted in May upon the announcement that BNPL users can dispute charges or demand refunds, while BNPL lenders pause payments during those disputes.In a Wednesday (March 26) court filing in Washington, D.C., CFPB said that it will revoke the rule, which BNPL providers and their trade groups have said would impose operational burdens.A Stay in Litigation and a RevocationIn terms of the mechanics, the Financial Technology Association — which had filed suit against the CFPB and the Bureau asked the presiding judge to “stay” the legal battle — noted that “the Bureau is planning to revoke the Interpretive Rule. To allow time for the Bureau to do so, the parties jointly request that the Court stay this litigation until the Interpretive Rule is revoked. The Bureau proposes to provide a status report with the Court by June 2, and every 30 days thereafter, regarding its progress toward revocation.”The filing also went on to state that the revocation would render “moot” the issues raised in litigation. The rule took effect at the end of last July, but firms were given further time to comply under a grace period.As PYMNTS reported in the wake of that October filing against the CFPB, the Financial Trade Association — which counts FinTech Block and BNPL provider Klarna among its members — contended that “the new rule is arbitrary and capricious because it fails to consider how its new disclosure obligations are ill-fitted for BNPL products, demonstrating that the CFPB fails to consider and address important aspects of how BNPL products function on the ground.”In particular, with discussion of what would amount to additional operational burden, the FTA suit had alleged that the periodic statements would have been “infeasible for BNPL products” and detailed that the structure of credit cards, where billing statements must be sent at least 14 days before payment is due, is such that “consumers can make numerous purchases at different times during a billing cycle with payment due for the collective amount on the same date irrespective of when the purchase occurred during the billing cycle.”BNPL loans typically require payments in two-week increments, so it is “impossible to send periodic statements for all loans collectively” at least 14 days in advance of the next payment, the FTA argued

Financial services company Block has reportedly laid off 8% of its workforce.The job cuts impact 931 people, TechCrunch reported, citing a Tuesday (March 25) email from Block Co-founder and CEO Jack Dorsey.In his message, Dorsey says the cuts are for strategic reasons (391 people) or to eliminate workers who perform below company standards (460 people). Block will also lay off 80 managers as it tries to “flatten” its organization, he added.A spokesperson for Block declined to comment when reached by PYMNTS Wednesday (March 26) morning.The company, which owns mobile payments platform Cash App and point-of-sale/payments firm Square, is also closing several hundred open positions, aside from those that have already moved to the offer stage, crucial operations roles and key leadership positions.“None of the above points are trying to hit a specific financial target, replacing folks with AI, or changing our headcount cap,” the email reads. “They are specific to our needs around strategy, raising the bar and acting faster on performance, and flattening our org so we can move faster and with less abstraction.”These layoffs follow a round of job cuts early last year, in which the company eliminated 112 positions as part of a larger cost-cutting effort.“We are creating an absolute cap on the number of people we have at the company, held firm at 12,000 people until we feel the growth of the business has meaningfully outpaced the growth of the company,” Dorsey had written in a letter to shareholders a few months earlier.A regulatory filing from late last month said that Block had 11,300 staff members worldwide as of December of 2024.PYMNTS wrote last week about Block’s push into the direct lending space, with Square Financial Services getting FDIC approval to make consumer loans directly to borrowers, using Cash App Borrow.“The announcement represents a shift, as the firm had previously made the loans through its external banking partner,” that report said. “By bringing the loan originating and servicing functions in house, Block retains the revenue streams associated with that lending.”The move also marks an expansion of Square Financial Services’ footprint, as the operation had already been offering Square sellers business loans and savings accounts.The push into short-term lending is also happening at a time when, per PYMNTS Intelligence research, traditional avenues for credit access are narrowing. For example, 29% of subprime consumers have seen their applications for credit cards denied, versus 12% of consumers who fall into the super-prime category