By Aisling Finn on Wednesday 10 February 2021
If the latest round is confirmed, Klarna will have raised $1.3bn in the last 12 months alone.
Klarna declined to respond on the rumour, with a spokesperson for the BNPL fintech adding that it “doesn’t comment on speculation.”
The report comes at a crucial time for the buy-now-pay-later sector with soaring demand for its services but Klarna and other BNPL fintechs have been under the microscope as of late as more people join the call for tighter regulation in the sector.
At the new valuation, Klarna will become the second European fintech to have tripled its valuation after payment processor Checkout.com did so twice, first in June 2020 and more recently in January of this year.
The fresh injection of capital has also reportedly accelerated the Swedish fintech’s plans to IPO, with Klarna now looking to list within the next one to two years.
Including the most recent rumoured funding round, Klarna has raised $1.3bn in the past year alone following a $650m funding round in September 2020 and a $200m investment from the Commonwealth Bank of Australia in February as it looked to help bolster the fintech’s position down under.
Released just a few weeks ago, the Woolard Review, an investigation into the fintech sector commissioned by the Financial Conduct Authority (FCA), recommended introducing tighter regulation for the BNPL sector.
Just weeks before the publication of the Woolard review, the Advertising Standards Agency (ASA) branded four Klarna ads as ‘irresponsible’ after several influencers posted ads for the fintech linking spending (and borrowing) money with happiness.
At the beginning of December, Capital One also became the first major bank to block BNPL credit card transactions, with the US bank describing such transactions as “risky for customers and the banks that serve them.”
Despite the roadblocks placed in Klarna’s way, the fintech’s most recent fundraise highlights the sector’s massive popularity and the rapid rate at which Europe’s fintechs are expanding.
AltFi approached Klarna for comment but it declined to provide one.