Payments

Klarna eyes US Market with “Klarna Card” and “Pay Now” services

Global payments provider and shopping service juggernaut Klarna is making a play for a bigger piece of the American market’s pie.

The BNPL provider announced Tuesday two new services for its US consumer base: An immediate payment option dubbed “Pay Now,” and its physical payment card, aptly referred to as the Klarna Card.

While Klarna is best known for its Pay-in-4 service in the US, American consumers can now pay immediately and in full at any online retailer where Klarna is available – an option that will bring it in line with over 20 other markets in which it is operating. The company explained that the newest option gives retailers an expanded set of choices for its customers beyond its Pay-in-4 and Pay-in-30 solutions.

According to research by Insider Intelligence, the pandemic’s impact and BNPL’s overall rise in popularity will lead the industry to rack up $680 billion in transaction volume worldwide in 2025. That forecasts a compound annual growth rate (CAGR) of 13.23% from the $285 billion the industry was estimated to record in 2018.

With the Klarna Card, which is already well established in Europe, consumers can pay over time in 4 interest-free payments for any in-store or online purchase. The card will be connected to Klarna’s loyalty program, Vibe, which rewards consumers who pay on time with exclusive deals and discounts.

Pre-integrated with the Klarna app, the card can also be added to Apple Pay and Google Pay wallets.

“Consumers continue to reject double digit interest rates and fee-laden revolving credit, while simultaneously seeking more choice, control and flexibility in how they shop and pay both online and in store,” said Sebastian Siemiatkowski, Klarna’s Co-founder and CEO.

“By launching ‘Pay Now’ and introducing the Klarna Card in the US, we are continually developing our services to meet consumers’ changing needs,” Siemiatkowski added.

Klarna, which is valued at about $46 billion, is among the largest players in the global BNPL sector with over 90 million global active users and processes 2 million transactions a day. The company has partnered with large retailers such as Bed Bath and Beyond, Saks Fifth Avenue, Petco, JCPenney, Converse, Wayfair, Pandora and 1-800-Flower, among thousands of others.

The Swedish-based fintech has slowly been integrating itself into the US consumer market for some time now. According to a release, over the past year alone, Klarna has nearly doubled its US customer base to over 21 million customers.

Just over a month prior to Tuesday’s news, Klarna bet on US expansion with its Pay-in-4 model to manage quarterly and annual subscriptions and memberships to US consumers. A week prior to that, Klarna unveiled its Super App that will turn the company from a payment provider into an end-to-end retail space. The platform now allows consumers to purchase and use their interest-free shopping feature across all online shops, whether connected to Klarna or not.

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