CFPB Closes Firearms BNPL Investigation Without Action

If you’ve ever used buy now, pay later (BNPL), you already know the vibe: “I’ll split this into four payments and pretend my budget is a calm, mature adult.”
The CFPB (Consumer Financial Protection Bureau) has spent the last few years trying to make sure BNPL grows up, tooespecially when BNPL shows up in places regulators consider
extra sensitive. One of those places: firearms-related commerce.

In August 2025, the CFPB quietly did something loud: it closed a years-long investigation into a firearms-focused BNPL provider without taking enforcement action.
Translation: no settlement, no consent order, no penalty from the Bureaujust a “case closed” note and a whole lot of debate about what it means for consumer protection,
regulation, and the future of BNPL oversight in the U.S.

What happened (and why people noticed)

The CFPB ended its investigation into Credova, a BNPL company known for offering installment financing tied to the “shooting sports” and outdoor-goods ecosystem.
Credova had become part of PSQ Holdings/PublicSquare, a company positioned as a values-driven marketplace and network of like-minded businesses. When the CFPB
closed the probe, the decision immediately drew attention because of (1) the subject matter (firearms BNPL), (2) the timing (a broader shift in CFPB enforcement posture), and
(3) the political spotlight surrounding the parent company.

The Bureau’s closure letter characterized the investigation as biased and politically motivated, and it cited the idea that financial services should not be weaponized against
“disfavored” lawful industries. Supporters framed the move as a correction. Critics framed it as a retreat. Either way, it’s a rare example of a high-profile, politically charged
consumer-finance investigation ending not with a bangbut with a “thanks for your time.”

Why the CFPB was looking at firearms BNPL in the first place

The CFPB doesn’t regulate “industries” the way a licensing agency might. It regulates consumer financial products and servicesand it tends to focus on
practices that can produce consumer harm: confusing disclosures, “junk fees,” aggressive collections, and dispute-resolution processes that feel like a choose-your-own-adventure
book written by a fax machine.

Firearms-related transactions add an extra layer of attention for two reasons:

• High scrutiny: Many banks and payment processors have long treated firearms commerce as “higher risk” from a reputation, compliance, or fraud perspective.
• High stakes: Financing can increase purchase power. Regulators and consumer advocates worry that weak underwriting and fuzzy terms can amplify financial stress.

BNPL products also bring their own “greatest hits” of consumer complaints: unclear fee triggers, inconsistent dispute rights, confusing payment pauses, and the classic
“I returned the item but my payment schedule didn’t get the memo.” When that mix shows up in categories that already trigger institutional caution, it’s unsurprising that
regulators want a closer look.

BNPL regulation 101: the CFPB’s attempted “credit card-ification”

The CFPB’s broader BNPL agenda matters here. In 2024, the Bureau issued an interpretive rule essentially saying: if a BNPL provider offers a digital account consumers use
like a credit card (especially for common “pay-in-four” plans), then key credit-card-style protections should apply.

What protections were the CFPB trying to extend?

• Dispute investigation: Consumers should be able to contest charges and have them investigated.
• Refunds for returns: If the underlying purchase is returned, consumers shouldn’t get stuck paying anyway.
• Periodic statements: Clear billing statements so people can track balances and payment status without doing detective work.

Importantly, this was not a full “BNPL becomes a credit card” moment. The interpretive rule focused on a subset of obligations; it didn’t magically convert every BNPL plan into
a revolving, interest-bearing product. Still, the direction was clear: BNPL’s “we’re different!” era was being replaced with BNPL’s “we’re different, but also… we should
follow some of the same consumer-protection rules” era.

Then the CFPB changed its posture

In 2025, the CFPB announced it would not prioritize enforcement actions based on that BNPL interpretive rule and said it was contemplating rescinding it.
That statement signaled a strategic pivot: fewer resources devoted to pushing BNPL providers into a credit-card-like compliance box, and more emphasis on other categories the
Bureau described as “pressing threats” to consumers.

This matters because when a regulator publicly deprioritizes enforcement, the market responds. Some companies keep strengthening protections (because it’s good business and
reduces complaint volume). Others take a “minimum viable compliance” approach. And consumers are left asking the world’s most inconvenient question:
“Wait, so what rights do I have with this product, exactly?”

So what does “closed without action” actually mean?

When the CFPB closes an investigation without enforcement action, it typically means:

• No federal CFPB consent order (so no negotiated compliance obligations tied to that probe).
• No CFPB civil money penalty tied to that case.
• No admission of wrongdoing through a CFPB settlement framework.

But “no CFPB action” does not mean “no risk, no rules, no consequences.” A BNPL provider can still face:

• State regulators: State consumer-protection agencies can pursue disclosures, fees, collections, and deceptive-practice claims.
• Private litigation: Class actions can form when fees or processes appear inconsistent with disclosures.
• Partner pressure: Merchants, banks, and processors can impose their own standards, especially in high-scrutiny categories.

Why Credova’s track record became part of the conversation

The investigation’s closure pulled older headlines back into the light. Reports and public records show Credova has faced scrutiny outside the CFPB contextparticularly around
fees and consumer protection issues.

Example: fee disclosure enforcement

One notable regulatory action came from California’s financial regulator, which ordered Credova to address disclosure issues related to “convenience” fees (also called
“pay-to-pay” fees) charged by third-party servicing arrangements. The thrust of the concern: consumers should not discover extra fees only after they’ve already committed to a
financing plan.

Example: consumer complaint volume as a risk signal

Complaint databases aren’t court verdicts, but they do function like smoke alarms: not every beep means your house is on fire, but you probably shouldn’t remove the batteries.
Reports noted complaints tied to billing, disclosures, and debt collection practices. For any BNPL providerespecially one operating in a high-attention sectorcomplaint volume is
reputational gravity.

Example: older settlements that shaped perceptions

Separate from firearms financing, Credova was also mentioned in connection with earlier state scrutiny around pet-leasing financing practices (a topic that sounds like satire
until you realize it was treated as a serious consumer-protection issue). The key point isn’t the category; it’s the pattern regulators care about: clarity, fairness, and whether
consumers understand what they’re signing up for.

The “debanking” angle: why the investigation became a culture-war proxy

A major theme in the CFPB’s closure rationale was the idea of “debanking”the claim that financial institutions sometimes deny services based on reputation risk or political
sensitivity rather than objective financial risk. This debate has been especially loud in industries like crypto, adult entertainment, and firearms-related commerce.

On one side: banks and payment providers argue they must manage compliance risk, fraud risk, and regulatory expectationsand that certain categories require more monitoring.
On the other side: critics argue that “reputational risk” can become a vague, unaccountable reason to restrict lawful commerce, creating a form of private-sector exclusion.

By framing the Credova probe as “weaponization” against a disfavored lawful industry, the CFPB closure effectively placed a consumer-finance investigation inside a broader
political argument about access to financial rails.

What this means for consumers using BNPL

If you use BNPLwhether for everyday purchases, big-ticket items, or anything in betweenthis moment is a reminder that protections can vary by product and provider.
Credit cards have decades of standardized dispute rules. BNPL is still in its “we’re all figuring this out” phase, and enforcement priorities can change faster than your payment
due date.

Practical (non-dramatic) consumer moves

• Read fee disclosures like you’re looking for a hidden boss level: Especially “payment method” fees or convenience charges.
• Ask about returns and disputes before you need them: “Do payments pause during a dispute?” is a surprisingly powerful question.
• Save receipts and return confirmations: The boring paperwork is your future self’s love language.
• Watch for autopay surprises: Know whether you can change payment dates or methods without penalties.

What it means for BNPL providers and merchants in high-scrutiny categories

The headline may sound like a victory lap for a particular company, but the broader lesson for the BNPL industry is more practical: regulators may shift, but consumer
expectations won’t. If customers feel trapped, misled, or nickeled-and-dimed, complaints riseand once that flywheel starts spinning, it’s hard to stop.

Best practices that age well (even when enforcement priorities don’t)

• Radical clarity: Explain total cost, fees, and payment methods in plain English.
• Dispute and return playbooks: Train support teams to resolve issues quickly and consistently.
• Collections restraint: Aggressive or confusing collections practices are complaint magnets.
• Third-party monitoring: If a servicer charges fees, consumers will still blame the brand they recognize.

What to watch next

This story isn’t “over,” even if the investigation is. Watch for:

• Whether the CFPB formally rescinds BNPL interpretive guidance or replaces it with a narrower approach.
• State-level enforcement filling perceived gaps, especially around fee disclosures and servicing practices.
• Industry self-regulation as BNPL companies compete on trust and customer experience, not just approvals.
• Advisory board and policy signals that indicate how aggressively the Bureau intends to pursue “fair lending” and related consumer-protection priorities going forward.

Conclusion: a closed case, an open question

The CFPB closing a firearms-focused BNPL investigation without action is bigger than one file folder getting archived. It reflects a shifting regulatory mood around BNPL,
a widening debate over “debanking,” and a practical truth about consumer finance: the most important rules are the ones consumers can understand and rely on.

Whether you see this closure as accountability or abdication, BNPL isn’t going away. The question is what kind of BNPL market we’re building: one where protections are
standardized and predictable, or one where consumers only learn the rules the hard wayright after they click “confirm.”

Real-World Experiences: The Stuff You Don’t See in the Press Release

Policy debates can feel abstract until you see how they play out in real life. And while every company and customer story is different, the same themes show up again and again
in BNPLespecially when a category attracts extra scrutiny.

1) The “return paradox” experience

A common consumer experience goes like this: someone buys a high-dollar item (think premium outdoor gear, a safe, or expensive accessories), uses BNPL to spread the cost, and
then returns it because it arrived damaged or didn’t match the description. The consumer assumes the refund automatically cancels the BNPL plan. Sometimes it does. Sometimes the
merchant processes a refund, but the BNPL schedule keeps chugging along like it never got invited to the meeting.

The result is frustration that feels less like “finance” and more like “customer service limbo.” Consumers end up acting as the human bridge between the merchant and the BNPL
provider: forwarding emails, uploading proof, and repeating the same timeline to multiple support reps. This is why the CFPB’s push for credit-card-like dispute and refund
protections resonated with many advocatesbecause the pain point is predictable and, frankly, avoidable.

2) The “fees I didn’t see coming” experience

Another recurring story involves payment method feesespecially when a third-party servicer is involved. Consumers may see a BNPL plan advertised as interest-free and assume
the total cost is straightforward. Then a “convenience” fee shows up when paying online or by phone. Even when fees are legal and disclosed somewhere, the experience can still
feel like a pop quiz: “Surprise! There was a footnote!”

In practice, consumers don’t distinguish between the BNPL brand and the companies behind the curtain. If a servicer charges a fee, the BNPL provider gets the blame. That
reputational spillover is why many compliance teams obsess over plain-language disclosures and “show me the total cost” screens. The business case for transparency is simple:
fewer surprises = fewer complaints = fewer regulators asking awkward questions.

3) The compliance-team experience: “build the parachute while falling”

For fintech compliance teams, regulatory swings can feel like driving through weather that changes every five miles. One year, the message is “BNPL needs credit-card-style
protections.” The next year, the message is “we won’t prioritize enforcing that interpretation.” Meanwhile, customers still expect disputes to be handled fairly, and state
regulators may still care a lot.

Many teams respond by building controls that hold up under multiple regimes: complaint monitoring, faster refund workflows, clearer servicing disclosures, and documented training
for customer support. Even when a federal agency backs off, nobody wants to be the company that “won” a policy debate but lost the trust of its users.

4) The merchant experience: BNPL is a sales tool… until it becomes a support ticket

Merchants like BNPL because it can increase conversion and average order size. But merchants also learn that BNPL can turn into support tickets when something goes wrong:
shipment delays, backorders, partial refunds, or returns. If a merchant’s policies and the BNPL provider’s policies don’t align, the customer feels stuck in the middle.

The best merchants treat BNPL like a core part of the checkout experience, not an add-on. They publish clear return timelines, coordinate refund procedures with the BNPL partner,
and train support staff to answer BNPL questions without guessing. That coordination matters more in high-scrutiny categories, where one messy customer experience can become a
headlineor at least a complaint that doesn’t disappear.

5) The “what happens next” experience

When the CFPB closes a high-profile investigation, companies often feel immediate reliefless legal spend, fewer document holds, fewer late-night calls. Consumers, meanwhile,
rarely feel anything right away. What they notice is whether their day-to-day experience improves: Are disclosures clearer? Do refunds happen quickly? Are disputes handled with
a human tone instead of a copy-paste script?

That’s the quiet truth behind the big headline. Enforcement actions matter, but so does the market’s own incentive to prevent complaints and keep customers. In the BNPL world,
trust is a feature. And unlike a checkout button, it’s not something you can A/B test your way into overnight.