Associated media – Connected media
Klarna, a leader in the financial technology sector known for its innovative “buy now, pay later” services, is venturing further into the realm of traditional banking by introducing a personal account feature and a cashback system to enhance customer engagement and loyalty. Announced on Thursday, these initiatives are part of Klarna’s strategic move to challenge conventional retail banking and shift consumer financial activities to its platform.
The newly revealed features, designed to simplify the management of payments and increase the frequency of customer purchases, were highlighted by CEO Sebastian Siemiatkowski in a discussion with CNBC. According to Siemiatkowski, these offerings are geared towards supporting everyday financial activities, allowing consumers to both save and earn through their transactions.
Set to be released across 12 international markets, including the US and various European countries, these innovations will be integrated into the Klarna app under the names “Klarna Balance” and “Klarna Cashback.” Klarna Balance acts as a virtual bank account where users can deposit funds to use for immediate purchases or to settle their deferred payments. Additionally, this balance will be automatically updated to reflect refunds from returned purchases.
The Klarna Cashback feature offers up to 10% back on purchases made at affiliated retailers, with the earned cash directly deposited into users’ Klarna Balance accounts.
This expansion is not Klarna’s first foray into bank-like services; the company has been offering similar financial products in Germany since 2021. With these new services, Klarna is now broadening its banking solutions to additional markets, enhancing its competitive edge in the fintech industry.
In regions like the EU, where Klarna holds an official banking license, customers can earn interest on their deposits, though this feature will not extend to US customers.
These developments come as Klarna approaches its anticipated IPO in the United States, marking a significant evolution in its product offerings as it transitions toward becoming a public entity.
While the exact timeline for Klarna’s IPO remains under wraps, Siemiatkowski hinted in a February interview on CNBC’s “Closing Bell” that a public listing within the year could be possible, though dependent on further progress and preparations. In tandem, Klarna is exploring a secondary share sale to provide liquidity options for its employees, with discussions ongoing under confidentiality, signaling a valuation of approximately $10 billion in the secondary market.
This strategic extension into banking services underscores Klarna’s ambition to redefine the financial landscape, offering users a more integrated and rewarding experience as it steps closer to its public market debut.
Linked media – Connected media
