Klarna Snags A Full Banking License

Pushing toward its longtime goal of being the “Ryanair of the FinTech sector” Klarna has made a big advance with the announcement that it has been granted a full banking license by by Finansinspektionen, the Swedish Financial Supervisory Authority.

“This is another exciting milestone on the Klarna journey to become the world’s favorite way to buy, but also for the European banking sector. We are now one of Europe’s largest banks with 60 million customers, 70,000 merchants and working seamlessly across borders,” noted Sebastian Siemiatkowski CEO of Klarna.

Klarna is the first FinTech business of its kind to grab a banking license. The firm is currently valued at over $2 billion and draws most of its customer base in online payments from Nordic nations and Germany.

“We want to be part of reshaping the retail banking industry. New regulations…set the right prerequisites for the destruction of that industry, but it needs a Ryanair to come along. We want to be that player,” Siemiatkowski noted in an interview after the news was announced.

Klarna’s revenue clocked in at  SKr3.6bn last year. With a banking license, the firm is committed to pursuing customers across Europe, offering up services like bank cards and salary accounts. Klarna has also not ruled out possible future expansion into the U.S. The firm is currently profitable.

“Banks are challenged. In the tech world, these companies get out-competed very quickly if they don’t deliver. But due to regulation, banks with very old technology — and poor customer satisfaction — have been able to prevail,” Siemiatkowski noted.

He added that the era of that ability to keep customers without keeping customers happy is soon coming to an end.

What we have seen in all other industries – take retail – is global players such as H&M and Zara. Global but more specialized. When a market grows, specialization increases. We are going to see more specialized customer offerings [in finance] that are at the same time global.”


New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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