Overview

Klarna is a Swedish fintech company that offers payment services to online retailers, primarily focusing on 'Buy Now, Pay Later' (BNPL) solutions. Founded in 2005, Klarna aims to simplify online purchasing by providing consumers with flexible ways to pay. For merchants, integrating Klarna offers the potential to increase sales, conversion rates, and average order value (AOV) by removing upfront payment barriers for customers, as detailed in Klarna's business resources for merchant advantages.

Klarna's core offerings include options like 'Pay in 4,' which allows customers to split purchases into four interest-free installments, and 'Pay in 30 days,' which defers the full payment without interest or fees if paid within the specified period. Additionally, Klarna provides longer-term financing options for larger purchases, subject to credit checks. The platform manages credit risk and fraud protection for merchants, taking on the consumer credit risk for approved transactions per their developer documentation.

The service targets a wide range of e-commerce businesses, from small and medium-sized enterprises to large corporations across various verticals, including fashion, electronics, and home goods. Integration typically occurs at the checkout stage of an online store, where Klarna appears as an additional payment option alongside traditional methods like credit cards. The user experience is designed for simplicity, allowing customers to complete purchases with minimal friction, often requiring only an email address and billing address for initial transactions.

Klarna operates globally, with a strong presence in Europe and North America. The company emphasizes a smooth customer journey and provides merchants with tools for managing orders, refunds, and disputes. Its compliance with regulations such as GDPR also underscores its focus on data privacy and consumer protection as outlined in their privacy policy. The company's technology is built to integrate with major e-commerce platforms, offering both pre-built plugins and direct API access for custom implementations.

The BNPL market, in which Klarna is a significant player, has grown substantially, offering an alternative to traditional credit, particularly among younger demographics. Companies like PayPal have also introduced similar services, such as PayPal Pay Later, reflecting the market trend towards flexible payment methods demonstrating competitive offerings. Klarna's continued development focuses on expanding its product suite and enhancing the merchant and consumer experience through its app and payment infrastructure.

Key features

  • Pay in 4: Allows customers to split purchases into four interest-free payments, typically due every two weeks for merchant benefits.
  • Pay in 30 days: Enables customers to receive goods and pay for them up to 30 days later, with no interest or fees if paid on time.
  • Financing: Offers longer-term financing options for larger purchases, often with interest, providing more substantial credit to consumers.
  • Merchant Fraud Protection: Klarna assumes credit and fraud risk for approved transactions, protecting merchants from chargebacks related to non-payment or fraud as part of their service.
  • Klarna App Integration: Consumers can manage all their Klarna purchases, returns, and payments through a dedicated mobile application.
  • Global Reach: Supports transactions in multiple currencies and across various international markets.
  • Seamless Checkout: Designed to offer a streamlined, one-click checkout experience for returning customers.
  • Developer SDKs: Provides SDKs for popular programming languages including JavaScript, PHP, Python, Ruby, Java, C#, and Node.js for easier integration per the API documentation.
  • Order Management APIs: Merchants can use APIs to manage orders, capture payments, handle refunds, and process returns programmatically.

Pricing

Klarna's pricing for merchants is transaction-based, with rates varying by product, country, and merchant agreement. The stated starting point is 2.99% + $0.30 per transaction.

Pricing as of 2026-05-05. Always refer to Klarna's official pricing page for the most current and specific details.

Product Typical Cost (Starting) Notes
Pay in 4 2.99% + $0.30 per transaction Rates can vary based on merchant volume and risk profile.
Pay in 30 days 2.99% + $0.30 per transaction Similar rate structure, risk assumed by Klarna.
Financing Variable Rates are often customized based on the financing terms, typically higher.
Setup Fees Often $0 Klarna generally does not charge setup fees for standard integrations.
Monthly/Annual Fees Often $0 No explicit recurring fees for standard accounts, transaction-based.

For detailed and country-specific pricing information, merchants should consult the official Klarna Business Pricing page.

Common integrations

Alternatives

  • Affirm: Offers point-of-sale loans with clear terms, emphasizing transparency and no late fees.
  • Afterpay: Provides 'Buy Now, Pay Later' services, primarily focusing on interest-free installment plans.
  • PayPal Pay Later: Integrated within the PayPal ecosystem, offering short-term installment and pay-in-30-days options.
  • Square Installments: Square's BNPL offering for merchants using their payment processing services.

Getting started

To integrate Klarna, merchants typically set up an account, configure their store, and then implement the Klarna widget at checkout. Here is a basic example using the Klarna Payments JavaScript SDK to initialize the widget on a web page, assuming the Klarna Payments library is already loaded and a client token has been generated from the backend:

// Assume klarna-payments.js is loaded and 'clientToken' is fetched from your backend

// Initialize Klarna Payments
Klarna.Payments.init({
  client_token: 'YOUR_CLIENT_TOKEN_FROM_BACKEND' // Replace with a dynamically generated client token
});

// Load the Klarna payment widget into a designated container (e.g., a div with id='klarna-payments-container')
Klarna.Payments.load({
  container: '#klarna-payments-container',
  payment_method_category: 'pay_later' // Or 'pay_in_4', 'slice_it', etc.
}, function(res) {
  if (res.show_form) {
    console.log('Klarna form loaded successfully.');
  } else {
    console.error('Failed to load Klarna form:', res.error);
  }
});

// Example of authorizing a payment after the user selects Klarna and confirms
function authorizeKlarnaPayment() {
  Klarna.Payments.authorize({
    payment_method_category: 'pay_later'
  }, function(res) {
    if (res.approved) {
      console.log('Payment authorized. Order ID:', res.authorization_token);
      // Send res.authorization_token to your backend to create the order with Klarna.
    } else {
      console.error('Payment authorization failed:', res.error);
    }
  });
}

// This function would be called by a button click, for example:
// document.getElementById('klarna-pay-button').addEventListener('click', authorizeKlarnaPayment);

This JavaScript snippet demonstrates the client-side integration flow. The client_token must be securely generated on your server and passed to the frontend. The authorize call returns an authorization_token which your backend uses to finalize the order with Klarna's server-side API as described in Klarna's API reference. For a complete integration, including backend API calls and webhook handling, refer to the official Klarna Developer Documentation.