The collaboration is designed to bring Klarna’s buy now, pay later (BNPL) payment methods into FreshBooks’ invoicing and payment flows, with no added setup required for merchants, per the release.
“Main Street small businesses and entrepreneurs are the backbone of the U.S. and Canadian economy, and getting paid reliably and on time is what keeps them running,” Lisa Robinson, head of partner success for the U.S. East Coast and Canada at Klarna, said in the release. “By partnering with FreshBooks, business owners can now use Klarna to offer their customers more ways to pay—in full, in four interest-free installments or financed over time. Customers get the payment flexibility while FreshBooks users retain the confidence of predictable cash flow.”
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A plumber invoicing for a routine job, for example, can accept payment in full, while a mechanic billing for a medium-sized repair can allow a customer to spread the cost over four payments, according to the release.
“Enabling our merchant users to process and reconcile payments directly within their business software is a huge convenience not just for them, but their clients and customers who enjoy an exceptionally easy, fast payment method,” Jeff Imm, general manager of financial services and payments at FreshBooks, said in the release. “Offering BNPL as a payment choice brings even more convenience to the process and has been shown to increase small business speed of cash flow and revenues substantially, while removing their risk of not receiving payment for their product or services.”
Also Wednesday, Klarna debuted Consumer FX, which lets shoppers purchase from any participating Klarna merchant anywhere in the world and pay using their own currency, with no exchange fee, according to a separate press release.
The launch means “any Klarna-connected merchant can sell to Klarna’s 120 million consumers in 26 countries with no new integration, and no need for a local entity or foreign bank account,” the company said in the release.
Klarna also handles foreign exchange disclosure, consent and compliance, with initial results showing that merchants see a 5% increase in conversion and 6% in sales with this extended reach.
Meanwhile, people who have children are more likely to use installment payments. The PYMNTS Intelligence report “The Family Factor: Where Pay-Later Providers Can Compete” found in October that 45% of married consumers with children and 39% of single people with children used credit card installments during the three months before being surveyed, compared to 25% for each group without children.
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