The German Government draft bill also introduces a new Point-of-Sale Financing Supervisory Act (Absatzfinanzierungsaufsichtsgesetz - AbsFinAG), which applies to suppliers and online platforms when they themselves grant consumers credit in the form of a loan, payment deferrals, or other similar ancillary financing facilities.
This will give rise to a dual-track regulatory approach: while Section 34k GewO-new targets activities where suppliers or platforms integrate third-party consumer credit offers and thereby assume an intermediating role, the AbsFinAG subjects to supervision those providers who offer their own deferred payment or instalment payment arrangements, even where this occurs in cooperation with a third party (usually through factoring).
For buy now, pay later (BNPL) and instalment purchase models widely used in retail, this means that regulatory supervision tightens whereby the regulatory classification will depend significantly on the specific structure of the arrangement. Models where an external financier provides payment facilities or consumer credit to buyers may in future be more readily characterized as intermediation activities and thus fall within the new licensing requirement under of Section 34k GewO new. Where payment deferrals are granted by the supplier itself, by contrast, there will generally be no intermediation activity. In such cases, however, a registration requirement with the Federal Financial Service Supervisory Authority (BaFin) under the AbsFinAG may apply.
Background and objective of the new framework
With Directive (EU) 2023/2225 (CCD 2), the European legislator has revised the consumer-credit framework to strengthen consumer protection and harmonize rules across the EU. Implementation into national law was to be completed by 20 November 2025. In Germany, the Federal Government presented a draft bill to implement the Directive on 3 September 2025. This draft is currently being discussed in Parliament and remains subject to change. The new regime is expected to enter into force on 20 November 2026.
Extended scope of the consumer-credit rules
To date, interest-and cost-free consumer loans, small loans below EUR 200 or with a term of no more than three months and with only insignificant charges, as well as interest-free payment deferrals or other ancillary financing facilities, have not been subject to the consumer-credit provisions of the BGB.
Going forward, the scope of application will in principle extend to these scenarios as well, including interest-free and cost-free payment deferrals. Exemptions are deliberately narrow and available only in very limited circumstances. They cover genuinely interest-free and cost-free, short-term payment extensions of no more than 50 days offered directly by the supplier, with only minimal charges for late payment. For larger online platforms, stricter rules apply: a 14-day cap for payment extensions and a prohibition on claim assignments effectively prevent most commercial BNPL models from escaping the consumer credit framework. As a result, the factoring models commonly used in practice will generally fall within the scope of the revised framework.
In addition, the German Government’s draft bill provides for comprehensive enhanced information requirements, replacement of the written-form requirement (Schriftformerfordernis) with text-form (Textform) for general consumer-credit agreements and a cap on the maximum withdrawal right to twelve months and 14 days.
Introduction of the point-of-sale financing supervisory act
The new AbsFinAG classifies suppliers and platforms that themselves grant point-of-sale financing falling under the newly extended scope of application of the consumer credit-rules as creditors. This is generally the case when suppliers or platforms are themselves the direct contractual counterpart of the consumer and no credit institution, payment institution, e money institution or investment firm (Institution) directly enters into a financing facility with the consumer.
New registration requirement under the new AbsFinAG
Under the AbsFinAG, BaFin will supervise creditors falling under the new consumer credit rules and may take administrative enforcement measures where necessary. As a general rule, creditors will also be required to register with BaFin.
The draft bill does, however, make use of an option under CCD 2 that allows Member States to exempt certain suppliers from the registration requirement This exemption applies to suppliers offering interest-free payment deferrals with only minimal late payment charges, provided they qualify as a micro, small or medium-sized enterprise (SME). A company is considered a SME if it employs fewer than 250 people and either its annual turnover does not exceed EUR 50 million, or its annual balance sheet total does not exceed EUR 43 million. Affiliated companies must also be included in the classification. Large companies are not exempt and will therefore fall within the scope of the registration requirement. Where payment claims against the consumer are contractually assigned in advance to an institution and the consumer contract is structured in compliance with that institution's specifications - which will regularly be the case with factoring arrangements that are widespread in practice - the registration requirement is replaced by statute with a notification obligation on the part of the institution.
Further obligations under the new AbsFinAG
The AbsFinAG also incorporates provisions from the German Banking Act (Kreditwesengesetz), which requires creditors to conduct a creditworthiness assessment before entering into a consumer credit contract. An exception applies where suppliers or platforms have agreed in advance to assign their payment claims against consumers to an Institution and the consumer-contract is structured according to that institution's specifications. In such case, the institution - not the creditor - is responsible for fulfilling all regulatory obligations under the AbsFinAG. This mechanism is designed to shift regulatory obligations to intermediary institutions, thereby reducing the administrative burden on smaller suppliers. However, the exception is also available to large companies that are subject to the registration requirement.
New licensing requirements under section 34k GewO-new
To implement the regulatory requirements of CCD 2, Section 34k GewO-new introduces a separate licensing requirement for the commercial, remunerated intermediation of consumer-credit agreements and other ancillary financing facilities, as well as related advisory services. Credit intermediation, which was previously regulated under Section 34c GewO, is now governed by the comprehensive new provisions of Section 34k GewO-new. In addition, credit intermediaries are required to register in the credit intermediary register under Section 11a GewO.
Germany has also made use of a Member State option: under Section 34k para. 4 No. 3 GewO-new, SMEs that act exclusively as a credit intermediary to finance their own sales of goods or services are exempt from the licensing requirement. Large suppliers and platforms, however, cannot avoid this requirement.
For the purposes of Section 34k GewO-new, " intermediation" encompasses all activities aimed at bringing consumers and lenders together to enter into a credit agreement – including advice, arrangement and organisation of the financing process. This is particularly relevant when companies integrate third-party credit offers into their sales process and where a credit agreement is entered into between the consumer and a credit or payment institution under the extended consumer-credit regime. According to the legislative materials, "tipoffs" do not constitute credit intermediation. In practice, a careful analysis of the specific activities involved will often be necessary to determine whether they fall within the scope of "intermediation".
It remains uncertain whether intra group financing structures are caught by the concept of intermediation under Section 34k GewO-new. This is particularly relevant for models in which an affiliated company – such as a group-owned financing subsidiary – grants consumer credit to the parent company’s customers while the operating entity supports or technically processes the transaction. The legislative materials do not currently provide clear guidance, leaving the question open whether such arrangements require a license.
Prerequisites for obtaining a license under section 34k GewO-new
As with other trade regulation licensing requirements, Section 34k GewO-new requires applicants to demonstrate personal reliability and sound financial circumstances. In addition, applicants must provide proof of expertise (IHK examination), covering knowledge of credit products, the applicable legal framework, consumer-protection rules and advisory and information duties. This expertise requirement may be delegated to a sufficient number of responsible employees. There also is an ongoing training obligation. The Federal Ministry for Economic Affairs and Energy may specify the requirements for expertise, further training and conduct and information obligations – including the disclosure of commissions and benefits – by means of a statutory order.
Registration requirement under section 34k GewO-new
With the introduction of Section 34k GewO-new, registration in the intermediary register under Section 11a GewO becomes mandatory. Both, the supplier and any (senior) individuals responsible for intermediation/advice must be registered. Entries are made via the competent Chamber of Industry and Commerce (IHK) and are publicly available in the DIHK online register.
Transitional provisions and deadlines
Credit intermediaries who have previously operated under Section 34c GewO may continue to rely on their existing licenses, which will remain valid as a license under Section 34k GewO-new until 19 November 2027. Applications for a new license must be submitted by 31 May 2027, and no new reliability check is required. Proof of expertise may be waived under a grandfathering rule (“Alte-Hasen-Regelung”) if an activity pursuant to Section 34c GewO has been carried out continuously since 1 January 2021 and the application is submitted by the deadline.
Suppliers who fall within the scope of Section 34k for the first time as a result of the new regulation are also granted a transition period until 31 May 2027. If the application is submitted on time, the activity may be continued until a decision on the application is made. All other requirements, including registration under Section 11a GewO remain unaffected.
Practical implications
Businesses should assess early whether activities related to instalment purchase, BNPL or other point-of-sale financing solutions - previously regarded as mere services or processing functions - may in future qualify as intermediation requiring a license under the GewO or as (own) credit granting requiring registration under the AbsFinAG. It is also important to consider what additional requirements will arise from the application of the new consumer credit and supervisory rules. In this context, business should check whether their sales and cooperation models – in particular with external financing service providers or banks – need to be adapted in light of the expanded scope of the consumer-credit rules. Depending on the specific design of the business model, the involvement of external financing service providers or the granting of own payment deferrals may have different regulatory consequences. In particular, hybrid distribution systems combining centralized e-commerce with decentralized stationary distribution, as well as franchise systems, should assess their regulatory exposure in good time.
In practice, the choice of model determines whether suppliers are primarily subject to the AbsFinAG or Section 34k GewO-new. Where external credit or payment institutions are integrated into the checkout or advisory process and become the consumer’s contractual counterparty (creditor), this may typically constitute intermediation. Unless an exemption applies, this may trigger a licensing requirement under Section 34k GewO-new, together the associated expertise, training and registration obligations – resulting in an increased regulatory burden. By contrast, the AbsFinAG applies where suppliers or platforms grant their own payment deferrals, invoice purchases or instalment plans. In these cases, the focus is on registration as a creditor with the BaFin, provided no exemptions apply. Depending on the specific design of the model, a (pre-agreed) assignment of receivables to an Institution may shift certain obligations (particularly the creditworthiness check) to that Institution; otherwise, the corresponding obligations under the AbsFinAG generally remain with the supplier.
