In 2005, Klarna was founded by Sebastian Siemiatkowski, Niklas Adalberth, and Victor Jacobsson.
Klarna was started through the help of an angel investor, Jane Walerud.
The company was named Kreditor Europe AB when it was first founded.
In 2009, Kreditor was rebranded as Klarna.
In the UK, Klarna was heavily criticized in the post payment sector as a company that encourages people to get themselves into large debts
In February 2021, the UK government started to regulate the post payment sector through UK’s Financial Conduct Authority.
In 2013, Niklas Adalberth stated that one of the company’s revenues comes from the reminders that they send to their consumers as well as legal fees for debt collection. He believed that the best customers for the company were people who didn’t pay their debts directly.
In Sweden, a large number of consumers complained about being charged with reminder fees in 2014. The company was also accused of threatening the consumers should they refuse to settle the debts.
In February 2020, Der Spiegel, a German news website, reported that Klarna’s consumer information are exposed and unsafe because of the autofill feature in the website. People can just extract their consumers’ information such as phone numbers, home addresses, postal addresses, date of birth, and so on.
In Germany, Klarna cannot demand a flat rate of €1.20 for reminder fees through email. This was ruled by the Discrict Court of Bremerhaven in 2022.
Identity theft and fraud were committed by using Klarna. A number of their consumers were victims of such crimes.
In March 2022, Klarna was fined by the Swedish Authority for Privacy Protection with KR7.5 million or $762.90 million for its inadequacies in handling their consumers’ private data.
Klarna is a Buy Now Pay Later company that provides online financial services for online purchases in their platform where partner merchants showcase their products.
Key stat
Key Info
Type
Private
Industry
Finance
Founders:
Sebastian Siemiatkowski, Niklas Adalberth, Victor Jacobsson
Founded
2005
Based in
Stockholm, Sweden
Area Served
Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Netherlands, Norway, Poland, Spain, Sweden, Switzerland, United Kingdom, United States, Greece, Czech Republic
Klarna has a valuation of $6.7 billion from their most recent funding last July 2022. The company’s worth falls 85% off from the mountain’s peak of $45.6 billion in 2021. Michael Mortiz stated that this fall is due to “investors suddenly voting in the opposite manner to the way they voted for the past few years”.
Klarna has a total of 70 investors, 18 of which are lead investors. Sequoia Capital and Canada Pension Plant Investment are the most recent investors. Let’s take a quick look on their most recent investors as of December 2022.
What is Klarna’s market share in the global BNPL industry?
In November 2021, CNBC reported that Klarna has a market share of 18% in the BNPL industry in the U.S. alone based on total revenue, trailing behind Affirm and Afterpay.
Company
Market Share (2021)
Klarna
18%
Afterpay
21%
Affirm
36%
As of October 2022, Klarna is currently the leading company in the BNPL industry with a market share of 44.5% based on the total number of downloads, an increase of 26.5% in less than a year.
Klarna is a buy now pay later processing company. Consumers or shoppers can purchase products in their website that are being sold by merchants, usually these products are offered for a discount to entice the consumers more. The wonder idea of this company is that consumers can buy products now and then pay the amount of the order value in a much later date with zero interest. The US website offers three products:
Pay in 30 Days
Pay in 4 Installments
Financing
Meanwhile, their UK website offers only two products:
Klarna has three plans, Pay in 30 Days, Pay in 4 Installments, and Financing in the US. For their Pay in 30 Days, and Pay in 4 Installments, the company makes their money by charging retailer’s fee. Every time a consumer shop, retailers pay a fee to Klarna. For US clients, the flat fee is fixed on $0.30 and a variable percentage fee between 3.29% to 5.99%. For UK clients, the retailer fee is 30p and 3.4% of the order value.
It should also be noted that in the UK, Klarna has only two plans presented in their website: Pay in 30 days and Pay in 3 Installments.
Meanwhile, the Financing option is ideally for larger purchases such as furniture and technology. This option helps consumers spread the cost of their purchase from 6 to 36 months through transparent credit card options in partnership with WebBank.
If a consumer fails to pay on the scheduled date, Klarna will try again to collect the payment. If the second try still fails then the missed payment will be added to the amount of the next payment. For US consumers, they will have to pay late payment fees for “Pay for 4 Installments”.
Klarna does not charge interest for both Pay in 30 days products and instalment products. However, their Financing product is akin to credit card loans wherein consumers receive financing from WebBanking to help spread the cost of the purchase.
What are the late fees for “Pay for 4 Installments”?
If consumers couldn’t pay on time, they incur late fees according to the value of their purchases. Consumers that has purchases below $25.00 will not incur late fees. Below is a more structure look on Klarna’s late fees for “Pay for 4 Installments”.
As of 2022, Klarna is in partnership with 450,000 merchants in their website. A marketplace that has large merchant base such as this will give consumers the most varied options they can choose from. A lot of these merchants offer discounts on their products for as high as 60%.
Klarna is very popular on people aged 25 to 34 with 26.86% of the traffic coming from this age bracket. This data is only an estimation based on the web traffic coming in and out of Klarna.
Klarna reported that ‘nostalgia’ served as the key shopping theme in 2022. Consumers bought products that reminded them of a more ‘carefree time’. Below is the list of the most popular items in 2022 per subcategory. This data will also shows us the year-over-year growth of per item on the same period from prior year.
The most popular items in terms of subcategories are:
Velor tracksuit was popular for Klarna consumers in 2022. It’s sales grew by +134% from January 2021. Army trousers were also trending on the platform.
Klarna is most popular in Germany with 28.65% of the traffic coming from the country. It is also very interesting to see that United States hold the second spot with 21.55%. Klarna was launched in the U.S.A. in 2015. This data is an estimation based on Klarna’s web traffic.
Klarna mobile app has been downloaded 45 million times in 2022. The data below shows us that Klarna has been downloaded more than 10 million times in Google Play. With this, we can assume that the rest were downloaded through the Apple Store.
These are the key stats and key info on Klarna mobile app on Android as of December 2022:
Key Stat
Key Info
Launch Date
November 01, 2018
Total Downloads
10 million plus
Rating Reviews
4.5 out of 5 stars
Total Review Votes
501,249
These are the key stats and key info on Klarna mobile app on iOS as of December 2022:
This section provides us an insight to Klarna’s operating income, total assets, and total equity through the years. In 2022, Klarna considered going public but has yet follow through as of the time of this writing.
Klarna has a total asset of SEK105.12 billion at the end of 2021 with an increase of 70.10% from 2021. Their asset also increased by SEK102 billion in 10 years.
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About the author
Ch Daniel is the co-founder of SignHouse and chairman of the CH Group. Daniel is leading the development of SignHouse's product, as well as strategising how else the company can reach its main mission: empowering 100M+ to use the world's most efficient document organisational tools.
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