Klarna takes on banks with its own debit card
Klarna, a Swedish fintech company known for its “buy now, pay later” services, is expanding its offerings with the launch of its own Visa debit card. The new product, called Klarna Card, is currently being piloted with select customers in the U.S. before a nationwide rollout. The card will also be available in Europe later this year.
This move is part of Klarna’s strategy to diversify its business beyond short-term credit products and position itself as a more comprehensive banking player. While the company is widely recognized for its buy now, pay later services, it aims to be known for its broader range of financial offerings, including a PayPal-like wallet experience and neobank services.
The Klarna Card comes with an account that can hold FDIC-insured deposits and facilitate withdrawals, similar to checking accounts offered by traditional banks. Powered by Visa Flexible Credential, users can access multiple funding sources — such as debit, credit, and buy now, pay later options — from a single payment card. While the card is a debit card by default, users can switch to Klarna’s pay later products, including “Pay in 4” and “Pay in 30 Days.”
By introducing the Klarna Card, the company is entering a competitive consumer banking market in the U.S., where established players like JPMorgan Chase & Co and Bank of America dominate. Fintech challengers like Chime have also gained a significant number of customers in recent years.
Although Klarna holds a full banking license in the European Union, it does not have its own banking license in the U.S. Instead, the company is able to offer FDIC-insured accounts through a partnership with WebBank, a financial institution based in Salt Lake City, Utah.
Overall, Klarna’s expansion into the debit card space signals its ambition to become a one-stop financial solution for customers, offering a range of services beyond just buy now, pay later options. The company’s push into consumer banking underscores its commitment to providing innovative and convenient financial products to its users.
