The news: The buy now, pay later (BNPL) giant added a Pay Now option to its US checkout experience so customers can pay in full wherever Klarna is accepted, per a press release.
Klarna will also introduce the Klarna Card—which lets users pay in installments in-store and online—to the US market “very soon.” The Klarna Card integrates into the Klarna app and is connected with its loyalty program, Vibe.
How we got here: Both the Pay Now feature and the Klarna Card are already available in much of the company’s European market: 50% of Klarna’s European volume comes from PayNow, per TechCrunch. And in October, Klarna brought Pay Now to the UK as part of its operational changes to mitigate BNPL scrutiny.
The US expansion feeds into the BNPL player’s transformation from a payments platform into an end-to-end shopping hub:
Our take: As part of Insider Intelligence’s Top Ten Trends for 2022, we predicted that Klarna’s UK overhaul would signal what’s to come.
Offering Pay Now helps mitigate mounting concerns about the financial risks involved with BNPL and get ahead of regulators: More than half of US BNPL users have missed a payment, per a July 2021 Marqeta study conducted in partnership with Propeller Insights.
Looking forward: Adding new checkout capabilities opens Klarna up to capturing more retail sales ahead of the holiday season.