KLARNA BANK AB

Klarna Bank AB (publ) is a Swedish bank and payments company headquartered in Stockholm, founded in 2005 and operating under a Swedish banking license granted by the Finansinspektionen. It provides checkout and post-purchase solutions for consumers and merchants, including “pay now,” deferred invoice (e.g., pay in 30 days), interest‑free installments, and longer‑term financing in selected markets, as well as a shopping app, virtual single‑use cards, and a payment card offered in certain countries. Klarna operates across the EU, the UK, the US, and other markets through a mix of passported permissions and local arrangements, and in the US some credit products are issued by partner banks. The company’s revenue comes primarily from merchant discount fees, interchange on card products, and consumer interest or late fees where permitted; it assumes and manages credit risk on receivables it originates or acquires and uses internal underwriting and data sources, including credit bureau checks in markets where that is allowed. Klarna also offers deposit products such as savings accounts in selected countries; eligible deposits with Klarna Bank AB are covered by the Swedish deposit guarantee scheme up to the statutory limit. The business has been subject to evolving regulation and supervisory scrutiny of “buy now, pay later” products, including privacy and advertising rulings in some jurisdictions. After rapid growth, it reported significant losses in 2022 and a reduction in losses in 2023, alongside a marked valuation reset in a 2022 funding round; it finances receivables through a combination of equity, warehouse facilities, and securitizations. Consumer approvals are not guaranteed, fees may apply for missed or late payments depending on the market, and in some countries Klarna reports certain activity to credit bureaus.