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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Consumer payment services company Klarna has selected account-to-account (A2A) payments company GoCardless to offer debit bank payments to its U.S. clients.
Specifically, Klarna will use GoCardless’ technology to transfer funds via ACH for its Pay in 4 offering that enables customers to split any purchase into four interest-free payments both online and in-store.
GoCardless CEO and Co-Founder Hiroki Takeuchi said that he anticipates alternative payment methods to experience rapid growth as leveraging debt falls out of favor. “Over the next few years we expect account-to-account payments to challenge the dominance of cards as they tap into changing consumer demand and provide merchants significant benefits in terms of cost, conversion and churn,” Takeuchi said.
Klarna CTO Koen Köppen noted that the U.S. is a key market for Klarna. The company doubled its customer base in the last year, and now has more than 21 million U.S. customers. “To continue along that trajectory,” Köppen noted, “we need partners that not only provide our consumers and retailers more choice and control but also offer us cutting-edge technology and best-in-class service. We’re excited to work with GoCardless and leverage its expertise in account-to-account payments as we expand in the U.S.”
GoCardless, which wonBest Enterprise Payments Solution at the Finovate Awards earlier this year, was founded in 2011. The U.K.-based company’s technology helps merchants collect recurring and one-off payments from customers via ACH transfers. Businesses can integrate GoCardless’ API to automate payment collection and reconciliation billing for subscription and invoice payments. Among GoCardless’ clients are DocuSign, Survey Monkey, and Box.com.
Today’s news about Klarna’s new ACH payment capabilities for U.S. customers is the latest in the company’s recent push into the North American region. Last month, Klarna announced it is adding its Pay Now option to its U.S. payment services. The company also unveiled plans to launch its physical debit card in the U.S. market.
GoCardless entered the U.S. market in 2019 and has since opened two offices in New York City and one in San Francisco. By the end of next year, GoCardless plans to grow its U.S. team by another 125%.
While some European fintechs are exiting the U.S. market, consumer payment services firm Klarna is doubling down. The Sweden-based company announced it is adding its Pay Now option to its U.S. payment services.
The Pay Now tool does exactly what it implies. Instead of using Klarna’s signature buy now, pay later (BNPL) payment structure, it allows users to pay immediately and in full at retailers where Klarna is accepted. This move offers U.S. shoppers more options when paying with Klarna at the point of sale. Users can now pay in full using Pay Now or pay over time with Pay in 4 and Pay in 30 solutions which allow users to split a purchase into four interest-free payments or pay over the course of 30 days, respectively.
“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 Klarna Co-founder and CEO Sebastian Siemiatkowski. “With the introduction of ‘Pay Now’, Klarna now offers U.S. consumers the choice to pay immediately and in full, alongside our sustainable interest-free services.”
As a result of adding the Pay Now option, U.S. retailers can now offer Klarna users a more well-rounded payment experience. By offering the option to pay in installments or pay immediately, consumers will be more likely to choose Klarna as a payment option regardless of whether or not they want to use a BNPL tool or pay in full immediately.
Klarna also announced it will launch its physical debit card to the U.S. market. The company wasn’t specific about timing but said it plans to introduce the new product “very soon.” Klarna refers to its debit card as a “tangible extension of the Klarna app experience” because it allows users to pay for their purchases over time and connects to the Klarna app to help users track their purchases. The card is also integrated with Klarna’s loyalty program, Vibe, which offers users rewards, deals, and discounts.
The past year has been quite an active one for BNPL companies. Klarna almost doubled its U.S. customer base this year, now reaching 21 million customers. “By launching ‘Pay Now’ and introducing the Klarna Card in the US, we are continually developing our services to meet consumers’ changing needs,” added Siemiatkowski.
Across the globe, the company counts 90 million active customers in 19 countries who make two million transactions per day at Klarna’s 250,000 merchants, including big brands such as H&M, IKEA, Expedia Group, Samsung, ASOS, Peloton, Abercrombie & Fitch, and Nike. Since it was founded in 2005, Klarna has raised $3.7 billion. The company now has a valuation of $45.6 billion and 4,000 employees.
The Buy Now Pay Later (BNPL) revolution shows no signs of abating any time soon. A combination of newcomers, Buy Now Pay Later pioneers, and even credit card companies like Visa and Mastercard are figuring out new ways to integrate themselves into the biggest consumer commerce phenomenon since shopping by smartphone.
According to CNBC, which bases its analysis on data from FIS Worldpay, the Buy Now Pay Later market has an estimated value of $60 billion globally as of 2019 – though there are even higher estimates. Excluding China, this sum represents 2.6% of all e-commerce. And while BNPL represents less than 2% of sales in North America, the overall BNPL market, CNBC believes, could reach $166 billion by 2023.
Here is just a smattering of this week’s headlines from the Buy Now Pay Later beat that only underscores the velocity of the flight from credit cards and traditional consumer financing.
Stripe teams up with Klarna as BNPL competition from Square, PayPal intensifies
Klarna, a company with a long pedigree in providing consumers with alternative payment options, announced this week that it was partnering with ecommerce innovator and payments platform Stripe. The deal will enable Stripe customers in 20 countries to offer Klarna as a payment option to their customers. As part of the partnership, Klarna will use Stripe to accept payments from consumers in both the U.S. and Canada.
“Over the past years, Klarna and Stripe redefined the e-commerce experience for millions of consumers and global retailers,” Klarna Chief Technology Officer Koen Köppen said. “Together with Stripe, we will be a true growth partner for retailers of all sizes, allowing them to maximize their entrepreneurial success through our joint services. By offering convenience, flexibility, and control to even more shoppers, we create a win-win situation for both retailers and consumers alike.”
The partnership is widely seen as a way for Stripe to compete with payments rivals PayPal and Square, which have deepened their commitment to BNPL in recent months. Square agreed to acquire Australia’s Afterpay for $29 million in August. A month later, PayPalannounced its $2.7 billion acquisition of Japanese Buy Now Pay Later company Paidy.
Affirm partners with American Airlines to ease cost of holiday travel
In a move well-timed to take advantage of end-of-year travel trends, American Airlines has announced a partnership with Buy Now Pay Later innovator Affirm. The collaboration will enable eligible travelers to pay for the costs of airfare over time on an installment basis, providing them with “flexibility, transparency, and control,” according to Affirm Chief Commercial Officer Silvija Martincevic. Using Affirm, travelers can pay for flights costing at least $50 with monthly installments without having to pay late fees or worry about hidden charges.
“While consumers are as eager as ever to get away,” Martincevic said, “they remain conscious of fitting travel into their budget.” Martincevic cited a survey conducted by the company that indicated that 74% of Americans queried said they would spend more on holiday travel this year “than ever before,” but that 60% were worried that they would not be able to “afford to travel as they would like to.”
The offering is currently available only to select customers, but will be expanded to include more U.S. consumers in the weeks to come. The collaboration marks the first time that American Airlines has integrated BNPL options into its website.
Marqeta and Amount announce collaboration to help banks offer BNPL
The partnership announced this week between card issuing platform Marqeta and bank technology provider Amount will make it easier for financial institutions to get into the Buy Now Pay Later business. Marqeta and Amount have forged a virtual card and loan origination partnership that will enable banks to go to market with their own BNPL/virtual card offering in months. This will help them boost revenues, grow market share, and promote loyalty.
Echoing the challenge that banks and other financial institutions face from Big Tech and fintech alike, Amount CEO Adam Hughes pointed to the partnership with Marqeta as a way for banks to close the consumer expectations gap between themselves and more tech-savvy, tech-native enterprises entering the financial services space. “Banks must compete or continue to lose market share to digital challengers who offer a more flexible way for their customers to pay,” Hughes said.
Part of what makes the Marqeta/Amount partnership interesting is how it takes advantage of research that suggests that a significant number of consumers who have used BNPL would prefer it if the service came from their bank or credit card provider. Amount’s modular approach to BNPL is configurable, easy to deploy, and integrates readily with banks’ legacy platforms, giving FIs the ability to introduce BNPL offerings over a variety of different channels and payment methods.
Berlin-based Billie banks $100 million in funding
The latest reminder of the international growth of Buy Now Pay Later comes from the $100 million investment secured by Berlin, Germany-based, B2B Buy Now Pay Later startup, Billie. The Series C round was led by U.K.-based Dawn Capital and featured participation from Tencent and, interestingly enough, Klarna. In fact, Klarna’s investment comes in the wake of a strategic partnership with Billie in which the two companies will integrate their service to better leverage their core competencies, with Billie serving business customers and Klarna handling retail consumers.
“BNPL for B2B is still in its infancy phase,” Klarna CEO and co-founder Sebastian Siemiatkowski explained, “even though the demand has never been higher. We are here to solve problems and by being able to offer this service to our merchant partners together with Billie, we are doing just that.”
The Series C round gives Billie a valuation of $640 million, and is believed to be the largest B2B Buy Now Pay Later funding round to-date. Co-founder and co-CEO of Billie, Dr. Matthias Knecht noted that those companies buying from larger businesses and individual retailers are increasingly embracing a “digital-first” approach that includes not just “modern user interfaces, high limits for shopping carts, as well as real-time decisions for B2B” but options like BNPL, as well. “There is nearly no provider of a BNPL product (for these companies) like what Klarna offers for B2C,” Knecht said. “We aim to close this gap.”
Visa expands BNPL offerings in Canada via partnership with Moneris
International card company and financial services provider Visa has been making inroads of its own into the Buy Now Pay Later market. This week, the company made headlines in the Canadian fintech news space via a new collaboration with unified commerce company Moneris.
“We’re happy to be working with a trusted brand like Visa Canada on providing a buy now pay later option to Canadians,” Moneris Chief Product and Partnership Officer Patrick Diab said. “Bringing flexible payment methods like buy now pay later to our merchants helps them offer their customers more options when it comes time to pay.”
Courtesy of the new collaboration, merchants partnered with Moneris will be able to leverage Visa’s BNPL solution – Visa Installments – to give eligible Canadian credit cardholders access to installment payments on qualifying purchases. Cardholders can use the existing credit on their cards to pay for purchases in smaller, equal payments over a defined time period, with no additional, new service sign ups or requirement to apply for a new line of credit.
Moneris is set to begin offering Visa Installments to its customers by the spring of 2022.
Does COVID have you dreaming up your long-awaited vacation? Consumer payment services firm Klarna’s latest acquisition may be of help.
The Sweden-based company snapped up Inspirock, an online trip planning service, for an undisclosed amount. Klarna CEO and Co-Founder Sebastian Siemiatkowski described the addition of travel planning “a natural extension of the benefits Klarna brings to payments and shopping.”
Founded in 2012, Inspirock leverages AI to help its customers explore a destination’s offerings and create personalized itineraries utilizing local expertise. On an annual basis, the California-based company sees 25+ million customers each year.
The integration will allow Klarna’s 90 million customers to use the Klarna app to pay for a trip in installments. In addition to the payment aspect, Klarna will also help users plan for their trip. Inspirock matches travelers’ preferences with over 230 million data points to optimize their travel itinerary and discover hidden gems.
“For customers, this makes the whole journey from inspiration to planning and preparing for a trip simpler, less stressful, and more fun, while enabling our retail partners to better reach and engage with their audiences by offering more personalized content,” said Siemiatkowski.
Combining travel planning with its existing payment capabilities inches Klarna towards becoming more like a super app. Founded in 2005 and with $3.7 billion in funding, Klarna offers buy now, pay later options to help users avoid credit cards while enjoying payment flexibility. Klarna also offers a shopping app to provide users with a holistic shopping experience– from payments to shipment tracking– and a rewards club it describes as the “vibeyest community in shopping.”
In a round led by SoftBank – and featuring participation from Adit Ventures, Honeycomb Asset Management, and WestCap Group – consumer payments pioneer Klarna has raised $639 million in funding. The investment brings the company a valuation of $46 billion at a time when the buy now pay later trend is reshaping consumer financing
“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 founder and CEO Sebastian Siemiatkowski said. “More transparent and convenient alternatives align with evolving global consumer preferences and drive worldwide growth.”
A Finovate alum since 2012, Stockholm, Sweden-based Klarna was among the innovators in “after-delivery payment” which enabled buyers to receive products before payment was due, with the facilitating company taking on all credit and fraud risk for online merchants. To state the obvious, Klarna’s approach to consumer financing has caught on in the years since with a wave of companies across the globe launching their own “buy now pay later” options – especially of late. Today, with this investment, Klarna is Europe’s biggest fintech unicorn, with more than $1.2 billion in 2020 revenues, and more than 18 million customers in the U.S. alone. The company’s payment options are available at nearly a quarter of the top U.S. retailers, and can be found in 17 markets around the world. Klarna’s most recent offering, Pay in 4, is a full embrace of the buy now pay later format, giving consumers the opportunity to pay for purchases over time in four, interest-free payments.
In addition to being the highest-valued private fintech in Europe, Klarna is now the #2 fintech in terms of valuation in the world – behind Stripe. And as part of the GiveOne initiative launched by Klarna earlier this year, the company will direct 1% of this week’s investment to “initiatives supporting planet health.”
“Klarna is really transforming and disrupting corporate giving by not only implementing a long-term commitment but also by enabling others to do the same,” explained Nina Siemiatkowski, founder and CEO of Milkywire, a social impact platform that serves as Klarna’s strategic partner in the GiveOne project. “We hope that many more companies follow their lead and support our planet by funding those who are on the frontlines making impactful change on a daily basis.”
Europe’s most valuable fintech startup just got a lot more valuable.
Klarna announced on Monday that it has raised $1 billion in new funding and earned a lofty valuation of $31 billion. The company, which set out to raise $500 million in the just-ended round, credited investor demand for the exceptional amount raised. Klarna CEO Sebastian Siemiatkowski also cited strong growth in the U.S. as a reason why investor dollars are flocking toward his company.
“What definitely has accelerated and changed is the success in the U.S. market,” Siemiatkowski said. “Investors are seeing Klarna getting ahead of its competitors. I think that has changed the perspective and changed the view on our valuation.”
According to Siemiatkowski, investors are seeing Klarna as the king of an e-commerce wave that is making Buy Now Pay Later a mainstream financing approach. The reverse layaway strategy of enabling consumers to receive goods and services now and pay for them in equal installments over time has made BNPL the hottest new thing in online shopping. Klarna, which was founded in 2005 and made its Finovate debut seven years later, has been a pioneer in “after delivery payment” and other forms of consumer financing for years. This week’s financing is, in part, a recognition of this fact and a bet that, amid rising competition, Klarna will come out on top.
Right now, both Siemiatkowski and Klarna’s backers seem equally eager to take on legacy consumer financing options as well as Klarna’s BNPL rivals. Pointing out how the buy now pay later approach is fairer insofar as it makes the same offer to all consumers, Siemiatkowski adds, “There’s a number of investors out there that agree with us. They see that this credit card industry is actually at its core flawed and needs some innovation.”
In addition to using the new capital for acquisitions, the company is more interested in synergies that will “help people save time and money” than it is in purchasing rivals. That said, Siemiatkowski does have a few novel uses for at least some of the company’s new funding: Klarna will donate approximately $10 million to organizations that are dedicated to fighting climate change.
More than 30 current and new investors participated in Klarna’s latest fundraising, including Silver Lake, Sequoia Capital, BlackRock, and HMI Capital. Other investors included Singaporean sovereign wealth fund GIC and individual investor, rapper Snoop Dogg.
Headquartered in Stockholm, Sweden, Klarna claims 90 million users and 250,000 merchant partners around the world. The company is optimistic about its growth in the U.S., saying they expect it to overtake Germany as its biggest market by the end of this year. The company has inked partnerships with 20 of the top 100 brands in the U.S., and said it gained a million new customers a month in the States in the final quarter of last year.
Klarna is taking its Buy Now, Pay Later (BNPL) platform to a logical next step. The Sweden-based company announced today it will launch a bank account offering in Germany.
This move makes Klarna the first BNPL firm to make such a move. The company will now compete with the growing roster of digital banks in Germany, including N26 and Tomorrow.
Users will receive a Visa debit card, which is available in two colors, and will have tools on the app to track, manage, budget, and analyze their spending habits. Klarna will also reimburse users for two global ATM transactions per month.
“Our focus is to provide a superior shopping experience to our consumers at the intersection of retail and banking,” said Klarna CEO Sebastian Siemiatkowski. “And we know that there’s still massive room for improvement to the way many people bank and save their money today. Users are demanding more seamless, intuitive and transparent services to meet their daily needs, but many banks still do not cater for this.”
As Siemiatkowski points out, Klarna banking will be useful for “bundling shopping and banking in one app.” However, it is difficult to see the extra value a Klarna bank account will bring to users who aren’t big on shopping. N26 touts an integration with Transferwise for easy and inexpensive foreign money transfers and Tomorrow differentiates itself with a positive approach to sustainability and social causes. Klarna, in contrast, makes shopping a more embedded experience. This isn’t necessarily a positive attribute for one’s finances.
To counteract this “spend, spend, spend” mentality, Klarna said it has plans to add savings goals to the banking app, a feature that is already available in Sweden.
A pilot of Klarna’s bank account will initially be available to the company’s “most loyal” users and will roll out to all Germany-based users “in the coming months.”
As the buy-now, pay-later (BNPL) craze explodes, some fintechs are in just the right place to catch the sparks. Payment services company Klarna is one of these players, and it has just landed $650 million in funding.
Today’s round adds to the company’s $1.4 billion in previously raised funds, bringing its total to just over $2 billion. The investment also boosts Klarna’s valuation to $10.6 billion, ranking the company as the highest-valued private fintech in Europe and the fourth highest worldwide.
The round was led by Silver Lake, GIC (Singapore’s sovereign wealth fund), and accounts managed by BlackRock and HMI Capital. Additional funds came from Merian Chrysalis, TCV, Northzone, and Bonnier, which have acquired shares from existing shareholders.
Klarna will use the funds to invest in product development, fuel global expansion, and build on its growth.
“We are at a true inflection point in both retail and finance,” said Klarna CEO and Co-founder Sebastian Siemiatkowski. “The shift to online retail is now truly supercharged and there is a very tangible change in the behavior of consumers who are now actively seeking services which offer convenience, flexibility and control in how they pay and an overall superior shopping experience. Klarna’s unique proposition, consumer preference and global retailer network will prove an excellent platform for further growth.”
As consumers seek alternative methods to finance their purchases, Klarna’s BNPL tool that enables users to pay in interest-free installments has gained impressive traction. The company’s shopping app has more than 12 million monthly active users worldwide, with 55,000 daily downloads.
And Klarna’s game is also strong on the merchant side of things, as many retailers have sought to increase online sales during stay-at-home orders. During the first half of 2020, the company added more than 35,000 new retailers to its existing merchant base of more than 200,000 partners including Sephora, The North Face, Timberland, and Ralph Lauren.
As a result of this growth, the company’s volume grew 44% over the first half of this year to more than $22 billion and its revenue increased 36% year-on-year to $466 million over the same period.
The following is a guest post from Scott Raspa, Head of Marketing, Hydrogen.
The European fintech scene has experienced tremendous growth over the last few years. One of the key drivers of this growth is open banking. This is causing financial institutions and fintechs to partner together to provide more innovative, user-friendly solutions for consumers throughout Europe.
European consumers are receptive to the idea of non-financial players offering financial products, according to EY’s Global FinTech Adoption Index 2019. The survey finds that fintech adoption throughout Europe, especially in countries such as the Netherlands, U.K., Germany, Sweden, and Switzerland, are well above the global average of 64%, and aren’t showing signs of slowing down any time soon.
Below is a list of the top 50 fintech companies in Europe, based on their valuations.
These companies have raised over $16.8B (€14.3B) in venture capital funding and are valued, collectively, at over $92B (€78B).
The U.K. fintechs are valued at nearly $40B (€34B). The Netherlands are second, all thanks to Ayden, the most valuable fintech in Europe.
The U.K. has also invested the most money, nearly $11B (€9.4B), almost 65% of the funding of these top 50 fintech companies. After the U.K., Germany and Sweden have invested the most with 12.9% ($2.1B / €1.78B) and 12.4% ($2.0B / €1.7B) of the overall funding, respectively.
Fintech Enablement in Europe
Here at Hydrogen we work with companies all over the world. Our award-winning fintech enablement platform enables organizations to quickly and easily build fintech products and components. Whether you want to offer a PFM app in France, a challenger bank in the U.K., or issue cards in Germany, Hydrogen is here to help. Hydrogen has pre-built integrations, workflows, business logic, and UI already built in and available in white labeled/no-code modules or through our robust API.
It’s free to get started, so start building with Hydrogen today!
*Note: Funding information was provided by Crunchbase.com and the Euro, Pound, and US Dollar conversions were based off of today’s conversion rate. Also, total funding amounts didn’t include public companies or companies where we couldn’t identify the funding received.
Six companies that have demonstrated their fintech innovations on the Finovate stage have been recognized this year by CNBC as part of their Disruptor 50 roster for 2020.
This year’s list, the eighth in the series, is marked by the high number of billion-dollar companies, or “unicorns.” Fully 36 of the firms in the 2020 CNBC Disruptor 50 have reached or surpassed the $1 billion valuation mark. Combined, the 50 companies have raised more than $74 billion in VC funding and achieved an implied market valuation of almost $277 billion.
The companies making the cut range in industry from cybersecurity and healthcare IT to education and, of course, fintech. In fact, the top-ranked company in the 2020 Disruptor 50 is none other than Stripe, the $36 billion payments platform founded in 2010. Stripe earned a #13 ranking in last year’s Disruptor 50 roster, and likely owes its first place appearance this year to a major $600 million funding raising – the company’s largest to date – and the economic and social consequences of the global health crisis.
“With many people throughout the world under lockdown to prevent the spread of Covid-19,” CNBC’s capsule on the company noted, “the move to shopping online has never been greater. That’s good news for digital payments platform Stripe.”
Stripe was not the only fintech to earn high marks from the 2020 Disruptor 50’s methodology. In addition to the half dozen Finovate alums below, some of the other fintechs on this year’s roster include:
Virtual bank WeLab (Hong Kong)
Digital mortgage company Better.com (New York City)
“Buy now pay later” e-commerce company Affirm (San Francisco, California)
Challenger bank Chime (San Francisco, California)
Banking app Dave (Los Angeles, California)
Microfinancier TALA (Santa Monica, California)
Trading and investing platform Robinhood (Menlo Park, California)
Also earning spots in this year’s list were a pair of insurtech companies, Lemonade and Root Insurance, as well as cybersecurity and biometric authentication firms SentinelOne and CLEAR, respectively.
Here’s a look at the Finovate alums that made this year’s list.
Courtesy of a partnership with a pair of current customers, card issuing platform Marqeta is open for business in Australia. The company announced today that its arrival in the Asia-Pacific market will also help support fellow Finovate alum Klarna and customer Doordash as they expand in the country.
“Card issuing is on its way to being an $80 trillion global opportunity by 2030, and Marqeta is perfectly positioned to take advantage of this over the coming years,” Marqeta founder and CEO Jason Gardner said. “The Australian market relies heavily on card spending and is digitizing rapidly. It is a market that was important to our customers and where we saw a lot of potential for Marqeta technology to help revolutionize customer experience in payments.”
Marqeta’s announcement comes in the wake of news that the company – in partnership with Visa – had earned certification to process payments in 10 countries in the Asia-Pacific region. In Australia, the first market in the APAC where Marqeta’s services will be available, the company hopes to take advantage of both the high penetration of traditional bank accounts compared to the rest of the region, as well as a boom in digital payments.
With the first transactions facilitated by Marqeta in late January, partner Klarna is already appreciating the results. “Our close collaboration in bringing an entirely new product offering and shopping experience to the Australian market in record time has been a big success,” Koen Koppen, Klarna CTO, said. “The positive reaction of Australian consumers is evident in just how many are downloading and using the app and virtual card each day.”
An alum of our developers conference, Marqeta delivered a presentation on Democratizing Issuer Payment Processing with Just-in-Time Funding at FinDEVr Silicon Valley in 2016. The Oakland, California-based company was last valued at nearly $2 billion, following a May 2019 Series E round that added $260 million to Marqeta’s coffers.
Chinese conglomerate Ant Financial has purchased a minority stake in Sweden’s e-commerce payments innovator Klarna. The terms of the investment were not disclosed, but the company said that the funding amounts to a 1% stake in Klarna. The most recent assessment of Klarna, based on a $460 million funding round in 2019, puts the company’s valuation at $5.5 billion.
“Alipay, and the wider Alibaba Group, have truly set the global pace on retail innovation and the app economy,” Klarna CEO Sebastian Siemiatkowski said. “We are delighted in this confidence shown in Klarna in defining the future of payments and shopping and are very much looking forward to working together further in the future.”
The investment comes as a tonic in the wake of Klarna’s first annual loss of $113 million in 2019. It also represents a deepening of the partnership between the two firms that will make more of Klarna’s buy now pay later solutions available to consumers and merchants in the Alibaba ecosystem. This includes more integration between Klarna and Alibaba’s Alipay which, via AliExpress, Alibaba’s retail online marketplace, leverages Klarna’s e-commerce solution.
“At the heart of this cooperation between Klarna and Alipay is a shared ambition of innovating truly superior shopping experiences and creating destinations of inspiration for consumers across the world,” Siemiatkowski said.
More than 200,000 merchants and e-commerce platforms around the world are powered by Klarna technology. The company’s partners include IKEA, Adidas, Spotify, and Expedia Group, among many others, and in 2019 alone, Klarna added more than 75,000 new merchants to its platform. Founded in 2005 and a Finovate alum since its debut at FinovateSpring in 2012, Klarna has 2,700+ employees and is live in 17 countries. Late last month, the company announced that Klarna had reached the seven million customer milestone and 1.6 million app downloads.
