Klarna wants you to buy now, and pay now

Klarna, the $45.6bn fintech behemoth, is expanding its services in the UK to offer immediate direct digital payments. 

Its 'Pay Now' option will allow Klarna to deepen its payments business beyond  BNPL with users able to pay instantly as long as Klarna is accepted by the merchant. This could lead to its app becoming more akin to a digital wallet and take on the likes of Paypal.

Best known for its buy now, pay later services only in the UK, Klarna offers a fuller suite of products in global several markets and is regulated as a bank in its native Sweden.

“We're doing this because we believe that most of the time, people should pay with the money they have - and we want to make sure they always have that option,” Klarna said in a media statement.

With the prospect of regulation for the booming BNPL market looming on the horizon, Klarna is also making a number of changes to its core service. These include what it says will be stronger credit checks using open banking as well as clearer language at online checkouts to ensure consumers understand that BNPL products are credit.

Sebastian Siemiatkowski,Klarna’s Co-founder and CEO said: “We firmly believe that most of the time, people should pay with the money they have, but there are certain times where credit makes sense. In those cases, our BNPL products offer a sustainable and no cost healthy form of credit - and a much needed alternative to high-cost credit cards. The changes we are announcing today mean that consumers are fully in control of their payments whether they pay now or pay later.”

As part of the sweeping changes to its business, Klarna is also removing late fees., 

While it has never charged late fees on its Pay in 30 or Pay in 3 BNPL products in the UK, it is now removing any remaining late fees from its longer term credit product which charges interest over 6 - 36 months.