Klarna takes on retail banks with new balance and cashback tools

by Gloria Methri

The Swedish FinTech giant Klarna has launched two new products that form part of the retail banks’ core business: everyday consumption and savings. Launched in 12 countries across Europe and the US, the initiative furthers Klarna’s mission to disrupt retail banking and become an everyday consumption partner for consumers worldwide.

The Klarna balance allows consumers to store money in a Klarna account directly from their bank account. They can receive cashback rewards for in-app shopping or refunds for returned items. Cashback rewards consumers who shop in the app. Shoppers earn a percentage of purchases at participating retailers and the money is saved to their Klarna account.

Co-founder and CEO Sebastian Siemiatkowski, said: “Our new products make it easier for customers to manage multiple scheduled payments, helping our customers use Klarna for more frequent purchases and increasing loyalty. We are already one of the most trusted brands in financial services and we want to build on that to support all consumers with their everyday spending. Today’s launches are a big step forward, allowing consumers to earn money while shopping and managing it on a Klarna account.”

With cashback, consumers can earn money back on everyday purchases. The cashback percentage varies by retailer, but can be as high as 10%. Unlike specific coupons, sales or offers, cashback works like real cash, giving consumers the flexibility to use it wherever Klarna is available.

The product launches follow the new Klarna card, which was announced in the US on 17 April. Already a hit in Sweden, Germany and the UK, the card offers a fairer and more sustainable alternative to traditional high-cost credit cards, enabling consumers to shop and pay as they wish.