Klarna Pushes Deeper Into Travel Sector With CarTrawler Partnership

Klarna says it has teamed with business-to-business (B2B) car rental solutions company CarTrawler.

The partnership, announced Wednesday (Dec. 13), lets travelers use Klarna’s buy now, pay later (BNPL) offering to pay for car rentals when booking on more than 70 airlines and 250-plus travel websites.

“Consumer demand for innovative, flexible payment options continues to grow, and our partnership with Klarna … enables our partners to offer their customers more choice and budget control for car rental and airport transfers,” said Peter O’Donovan, CarTrawler’s CEO.

He added that the initiative is in “direct response to the insight we have gathered across our global travel network for changing preferences in the market.”

CarTrawler’s insights are in line with recent research by PYMNTS Intelligence, which shows that consumers are increasingly turning to BNPL to fund their holiday travel.

“All generations, particularly the youngest, are finding ways to finance their travel,” Jacqueline White, president at i2c, said in a recent interview with PYMNTS Intelligence. “Consumers are now using more BNPL or other flexible payment options for it, and this is something relatively new in the U.S.”

PYMNTS research finds that 75% of shoppers plan to use credit for holiday purchases, including leisure travel, while 25% prefer BNPL as a better option to maintain cash flow. This flexible payment option is more popular among younger consumers, particularly Gen Z, with close to 40% using it for this purpose.

“Younger generations do not like debt as much as other older generations,” White said. “They are cautious about accumulating high-interest debts. Thus, they are drawing money from BNPL, as it allows them to better stretch their budget.”

Meanwhile, PYMNTS CEO Karen Webster spoke Wednesday with Drew Olson, senior director at Google Pay, who said Google’s shoppers are demanding more choice at checkout as they grow ever more familiar with BNPL as a favored form of credit.

“Whatever calculus the user performs to determine the payment methods that they want to use, they want more options across more merchants,” he told Webster.

To that end, Google Pay launched a pilot program with Affirm and Zip that will “surface” those providers’ multiple BNPL options at select merchants in the United States that offer Google Pay at online checkout.