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Klarna and Expedia Team to Bring BNPL to US Travelers

Travel company Expedia has expanded its partnership with payments network Klarna.

The new collaboration, announced Monday (April 22), brings Klarna’s flexible payments offering to travelers in the U.S., following the launch of the company’s installment payments to Expedia customers in the UK, Germany, Finland and Klarna’s home country of Sweden.

“By enabling U.S. consumers to Pay Now or Pay Later with Klarna, we are not only making travel more financially accessible, but also enhancing the booking experience with our seamless payment process,” said Erin Jaeger, head of North America for Klarna. “It’s a win-win for travelers seeking both adventure and affordability.”

The partnership is happening as buy now, pay later (BNPL) programs like Klarna grow in popularity for travelers.

Last fall saw Klarna join forces with business-to-business (B2B) car rental company CarTrawler to use Klarna’s BNPL offering to pay for car rentals when booking on more than 70 airlines and 250-plus travel websites.

And in September of last year, Booking.com and Affirm teamed to make the latter company’s BNPL offering available at checkouts across several Booking travel brands. Affirm’s quarterly earnings late last year showed that travel industry spending was up 56% as measured in gross merchandise volume.

“PYMNTS Intelligence research showed that while credit cards still hold dominance in financing holiday travel — 66% of consumers used cards — the inroads made by BNPL have been significant, as 19% of respondents have opted for that payment option,” we noted here in December of last year.

“Only 4.5% of baby boomers and seniors have used the method, but more than a quarter of younger generations — who have more spending power over time — have done so, including millennials and Generation Z consumers.”

In other BNPL news, PYMNTS wrote Monday on research showing that while credit union (CU) members are fans of this payment method, close to half of all CUs say they have no plans to introduce buy now, pay later offerings.

“This disconnect — that CU members are nearly twice as likely as non-CU members to want their CU to offer BNPL innovations while almost half of CUs have no plans to do so — suggests many CUs are running the risk of losing members,” PYMNTS wrote. 

“On the other hand, those CUs that do commit to offering BNPL products stand to gain by welcoming new members who seek innovation.”