Swedish payments firm Klarna is facing a possible strike by employees in its home country.
The Unionen and Swedish Engineering unions announced Thursday (Oct. 26) that the strike will commence on Nov. 7 if a collective bargaining accord is not reached.
Negotiations have been underway since March, with both sides accusing each other of acting in bad faith.
The unions say Klarna, which provides buy now, pay later (BNPL) services, has repeatedly canceled and postponed previously scheduled negotiation sessions and failed to fulfill its commitments.
“Now, unfortunately, we see no other option than to announce a strike,” said Martin Wästfelt, head of negotiations at the union.
Klarna CEO and Co-founder Sebastian Siemiatkowski posted on X/Twitter that the unions have told employees they will “be locked out and lose their pay” if they don’t strike, and will be banned for all future union membership unless they strike.
“The primary focus for us right now is our employees who are in shock,” he said.
News of the possible strike comes as BNPL continues to be a popular payment method, especially among younger consumers.
“Younger generations, particularly millennials and Generation Z, who are burdened by credit card debt and high interest rates, are leading the charge in adopting BNPL as their preferred payment option,” PYMNTS wrote recently.
In fact, 28% of millennial and Generation Z consumers say they would abandon a purchase if BNPL were not offered to them at checkout. This shift in consumer behavior is remaking the retail payments landscape, with BNPL turning into a must-have for shoppers.
Not only do millennials lead the charge in BNPL adoption, they are also shaping new shopping norms. Their average spend of $1,851 via BNPL, compared to $1,485 for traditional credit cards, underscores the dominance of BNPL in their purchasing decisions.
Meanwhile, Klarna recently debuted an artificial intelligence (AI)-powered shopping tool with the help of ChatGPT-maker OpenAI, announced earlier this month as part of a broader rollout of new shopping-related offerings.
The flagship among these new tools is the company’s shopping lens, which — armed with OpenAI technology — allows customers to shop by taking a picture of merchandise they like. Within seconds, those items become available for purchase on the Klarna mobile app.