Klarna raises giant $639M funding round led by SoftBank

European buy now, pay later giant Klarna has raised a $639 million equity funding round with a post-money valuation of $45.6 billion, a news release shows.

The megaround was led by SoftBank’s Vision Fund 2 along with participation from other investors to help expand the fintech company’s international presence and scale its retail growth. Klarna claims its the highest-valued private fintech in Europe.

Klarna empowers shoppers with flexible payments solutions with retailers like Lenovo, Macy’s, Footlocker, Etsy, and thousands of other stores across multiple categories. Users can leverage buy-now-pay-later capabilities with four interest-free payments and no credit impact via the company’s instant approval process.

“Consumers continue to reject interest-and fee-laden revolving credit and are moving toward debit while simultaneously seeking retail experiences that better meet their needs. Klarna’s more transparent and convenient alternatives align with evolving global consumer preferences and drive worldwide growth,” Sebastian Siemiatkowski, Klarna Founder and CEO, said in a statement.

Klarna’s app has 18 million users across the world and is available at over 250,000 retailers globally. The company said in the press release that it recorded over $18.9 billion “for the period driven by growth in all markets,” while its first quarter in 2020 saw $9.9 billion. It also said that its app downloads this year have increased 125% year-over-year.

“Klarna’s growth is founded on a deep understanding of how the purchasing behaviors of consumers are changing, an evolution which we believe is accelerating. Klarna has already successfully expanded into the US and we are excited to continue supporting the team in bringing the next generation of financial services to new markets worldwide,” Yanni Pipilis, managing partner for SoftBank Investment Advisers said in a statement.

In other recent news, Marqeta Inc., a California-based company that is largely known for providing payment infrastructure for Square, went public on the NASDAQ with a $15 billion valuation, according to reporting by Reuters.

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