Klarna for Businesses
Klarna is a Swedish payment provider and licensed bank known for its "Buy Now, Pay Later" service. For businesses, Klarna is a payment method available at checkout: Customers pay by invoice, either immediately or in installments, while you, as the business, receive the full amount minus fees right away. Klarna bears the risk of non-payment.
At a Glance
- Klarna is a Swedish fintech company that allows sellers to offer payment methods such as immediate payment, purchase on account, or installment plans (Buy Now Pay Later).
- With installment payments, you receive the full amount minus fees immediately, regardless of when customers pay.
- For purchases made by invoice or in installments, Klarna bears the risk of default and fraud.
- For businesses, Klarna can increase conversion rates and shopping cart value, but it does incur fees.
What does Klarna mean for businesses?
For businesses, Klarna is a payment method that makes purchases more flexible for customers and eliminates the risk of non-payment for you. Klarna checks creditworthiness in real time at checkout, pays you the full amount immediately, and handles the collection of the payment. In return, fees are charged per transaction.
How does "Buy Now, Pay Later" with Klarna work?
"Buy Now, Pay Later" means that customers don't pay until after they've made a purchase. With Klarna, they select a payment method at checkout, Klarna checks their creditworthiness in real time, and completes the purchase. You receive your money immediately, and customers pay later by invoice or in installments.
Payment Method
How Customers Pay
Risk of Default
Pay Now
directly via direct debit, bank transfer, or the Klarna app
for salespeople
Invoice (Pay Later)
within 14 to 30 days of receipt via Klarna
with Klarna
Installment
in several monthly installments
with Klarna
Is Klarna a factoring company?
Not in the traditional sense. However, from a business perspective, purchase on account works similarly to factoring: Klarna takes on the receivable—including the credit risk—and pays you immediately. Historically, Klarna actually started out as a factoring model, but today it is a more broadly diversified payment provider with a banking license.
Common Misconceptions
- "Klarna only charges customers." For individual users, Klarna is usually free. The company pays the fees per transaction.
- "With Klarna, I, as a business, bear the risk if customers don't pay." With invoice and installment purchases, Klarna bears the credit risk—not you.
- “Klarna is just an installment plan.” Klarna also offers instant payment and payment by invoice. Payment in installments is just one of several options.
ablefy classification
With ablefy, your customers can pay with Klarna at checkout, in addition to credit cards, PayPal, and SEPA direct debit. Because Klarna pays out immediately for invoice and installment purchases and assumes the risk of default, it’s particularly well-suited for higher-priced items.
Frequently Asked Questions About Klarna
How much does Klarna cost for businesses?
Klarna charges a fee per transaction, usually a fixed amount plus a percentage. The amount depends on the payment method; purchasing on account is more expensive than immediate payment.
As a business, when will I receive my payment?
Generally, payments are made promptly, regardless of when customers pay. For purchases on account, Klarna makes the payment as soon as the goods are shipped or the service is provided.
For which products is Klarna a good option?
This is especially true for higher-priced offers, which customers might otherwise hesitate to purchase. The option to pay later or in installments lowers the barrier to purchase.
Is Klarna the same as a payment service provider (PSP)?
No. Klarna is a payment method. A payment service provider (PSP) bundles many payment methods through a single interface. Klarna can be offered as one of these methods through a PSP or a platform.
