Klarna to launch consumer bank

Buy now, pay later (BNPL) company Klarna has announced the launch of its first digital consumer bank accounts, which will be available to customers in Germany.

The company said that the offering will first be made available to a limited number of Klarna’s “most loyal” customers so that it can collect feedback, before rolling out the banking service across all Klarna users in the region over the next few months.

Klarna, which was founded in 2005, has a total valuation of $10.65 billion following an equity funding round worth $650 million last September.

A Klarna bank account will come with a Visa debit card which can also be connected to both Google Pay and Apple Pay.

"Our focus is to provide a superior shopping experience to our consumers at the intersection of retail and banking,” said Sebastian Siemiatkowski, chief executive, Klarna. “And we know that there’s still massive room for improvement to the way many people bank and save their money today.

He added: “Users are demanding more seamless, intuitive and transparent services to meet their daily needs, but many banks still do not cater for this. We are very excited to introduce Klarna Banking today, bundling shopping and banking in one app and allowing our consumers to bank in the same seamless way as they shop with Klarna.”

The Klarna bank account will include self-service sign up with an own developed KYC process called ‘Klarna Ident’.

The Swedish BNPL provider said that video identification possible in this process, but not necessary.

Other features include three-click transfers, instant top-ups and monthly budgets for spending across purchase categories.

The company said cash withdrawals can be made at all ATMs with a Klarna debit card, including abroad, but that they are free of charge only twice a month.

The bank accounts will be secured by biometric recognition data, including facial recognition and fingerprints.

The Klarna bank will be totally digital, with accounts opened via the Klarna App.

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