Klarna’s Card User Base Reaches 5 Million Mark

Payments and digital banking company Klarna says its Klarna Card now has 5 million customers.

In announcing the milestone Thursday (March 19), the Swedish FinTech said this highlights rapid adoption by consumers seeking more control over their money.

“The pace of adoption shows a clear shift in how consumers want to manage everyday spending,” David Sandström, chief marketing officer at Klarna, said in a news release.

“They’re voting with their wallets and looking for the control and flexibility in a single card. Unlike traditional banks, Klarna gives people the choice to pay now, or pay over time: the right tool for each situation.”

The card draws from customers’ funds for day-to-day spending, giving them the option to spread the cost of specific purchases on things like travel or major appliances, without having to deal with long-term debt obligations, the release added.

“Now available in 16 countries, from Paris to Stockholm, London to Los Angeles, the Klarna Card is becoming a central entry point into Klarna’s broader suite of payment and banking service,” the release said.

Meanwhile, new research from PYMNTS Intelligence research shows that pay-later options like Klarna’s are increasingly segmented by financial purpose.

“Consumers are not simply selecting a payment button at checkout. They are choosing a financial strategy,” PYMNTS wrote in a report on the findings.

The research shows that 31% of consumers turned to credit card installment plans in January, compared with 12% who used buy now pay later (BNPL) offerings, a gap indicating “that installment products have become the most widely used pay later option across demographics and income levels.”

Beyond that, the findings show that 43% of shoppers choose BNPL primarily for speed and approval, which suggests that these consumers use this method as a fast-access tool at checkout, and not a long-term credit plan.

Still, 34.2% of consumers point to credit management as the main reason they use credit card installment plans, the report said.

“This positions installment products as structured borrowing tools used for budgeting and managing credit limits,” PYMNTS wrote.

Also this week, Klarna announced its global merchant base now exceeds 1 million, with the number of merchants offering the company’s payment methods climbing 47% in the last year.

This week also brought a report from Bloomberg News that the company had lost four high-level staffers since January, including its head of investor relations and its engineering director.