Klarna, one of the world’s largest private fintech companies and aggregators of the Buy Now, Pay Later trend, announced Wednesday it is now offering its Pay-in-4 model to manage quarterly and annual subscriptions and memberships to US consumers.
US consumers can now spread their subscription purchases over four interest free payments via the Klarna platform as the company works to root itself deeper in the servicing economy.
According to Insider Intelligence, the subscription economy is growing exponentially, with US retail ecommerce sales projected to grow to $28 billion in 2021. By 2023, 75% of organizations selling direct-to-consumer are expected to offer some form of subscription services, reports the Subscription Trade Association.
Founded in 2005, Klarna is one of the most highly valued private fintechs globally with a valuation of $45.6 billion. The BNPL juggernaut is active in 17 countries and hosts over 250,000 retail partners, including H&M, IKEA, Expedia Group, Samsung, ASOS and Peloton.
Klarna’s recent US offering builds on the companies growing subscription payments markets including Sweden, Norway, Finland, Germany, Austria, UK, and the Netherlands, with plans to further expand the offering in 2022.
“The subscriptions market has seen massive innovation in the last decade to meet increased demand and popularity amongst consumers,” said David Sykes, Head of North America, Klarna.
“That’s why we’re thrilled to announce Klarna’s subscription offering in the US and a first for the market,” Sykes added. “As competition intensifies, the brands that provide the best services across value, flexibility, and a customer-obsessed experience will thrive.”
Ahead of holiday shopping, Klarna has definitely upped the ante on the competition. Just one week prior to Wednesday’s release, Klarna unveiled its Super App that will turn the company from a payment provider into the end-to-end retail space. The platform now allows consumers to purchase and use their interest-free shopping feature across all online shops, connected to Klarna or not.
New features in place, Klarna shows aim to provide a stickier customer experience and help Klarna control the entire shopping pipeline.
The BNPL giant also announced one day prior to its super app release that it had closed on a deal to acquire the price comparison platform PriceRunner in a bid to bring enhanced app features to Klarna’s global customers. The acquisition of the nearly 20-year-old German fintech marks Klarna’s fifth acquisition for 2021 following its procurement of Stocard, Apprl, HERO and Inspirock.