The news: Buy now, pay later (BNPL) giant Klarna partnered with Germany-based Billie, which offers BNPL services for business payments, according to a press release. The integration will let Klarna’s merchants with business customers offer Billie’s services. It will roll out in Germany in Q1 2022, with plans to follow for other European markets.
How it works: More than 250,000 eligible merchants will be able to activate Billie’s offering, which will be incorporated into Klarna’s existing processes. Billie offers shopping limits of up to €100,000 ($114,025) and boasts a 90% conversion rate, making it a compelling option for merchants.
The opportunity: Globally, the B2B payments market is worth $84 trillion, according to Juniper Research, which could be pulling providers into the space.
As B2B ecommerce expands, it makes sense for providers like Klarna to integrate BNPL for online transactions. And doing so through a partnership with an established provider can help Klarna scale quickly to beat out new entrants like Behalf and Resolve, which recently raised $100 million and $60 million, respectively, to move into the space.
Why it matters: Pushing into B2B BNPL reflects industry players trying to diversify as the entrance and expansion of heavyweights like Capital One, Mastercard, PayPal, Square, and Visa are intensifying competition. As a result, established digital-first players are forging partnerships that might help grow their reach, like Splitit’s recent tie-up with Discover and Affirm’s deals with Target and Amazon. And everyone is looking to expand into new markets.
B2B represents the latest greenfield for providers to diversify and expand their business into rather than going head-to-head with the competition to steal market share.
Go deeper: To learn more about the state of the BNPL space and how incumbents stack up, check out our "Buy Now, Pay Later Report.”