Klarna Expands Beyond Buy Now, Pay Later with New Card and Mobile Plans Amidst Criticism and Regulatory Warnings

Klarna, a Swedish buy now, pay later (BNPL) company, has made its US stock market debut with a $16 billion valuation. The company has over 26 million users in the US and aims to expand beyond BNPL through new products, such as a card and mobile phone plans. However, its expansion has been met with criticism, and regulators and financial experts have warned about the risks associated with BNPL, including impulse buying and late payments.

Klarna, the Swedish buy now, pay later (BNPL) company, has made its US stock market debut with a valuation of $16 billion. The company's shares jumped 16% on Wednesday, finishing the day at $46.40, just hours after its market debut on the New York Stock Exchange (NYSE) Klarna stock jumps 16% in NYSE debut, valuing BNPL leader at $17.5 billion^[1].

Klarna's IPO was a significant milestone for the company, which has over 26 million users in the US. The company's chief executive, Sebastian Siemiatkowski, stated that the IPO is an opportunity for new shareholders, consumers, and others to participate in the company's journey to disrupt the financial services industry Klarna’s Soaring Debut Sets the Tone for BNPL and IPO Revival — But Risks Lurk^[2].

However, Klarna's expansion has not been without criticism. Regulators and financial experts have warned about the risks associated with BNPL, including impulse buying and late payments. Critics argue that BNPL platforms like Klarna encourage overspending and face credit risk if their customers default Klarna stock jumps 16% in NYSE debut, valuing BNPL leader at $17.5 billion^[1].

To address these concerns, Klarna has been expanding its product offerings beyond BNPL. The company plans to launch a card and mobile phone plans, aiming to diversify its revenue streams. Klarna's advertising business has also been growing, with the company reporting $180 million in advertising revenue for 2024, up from $13 million in 2020 Klarna solves profitability puzzle through millions in ads business^[3].

Despite the challenges, Klarna's IPO has been seen as a positive sign for the fintech sector. It has the potential to revive the US IPO market, which has been largely dormant since the tariff-driven volatility earlier in 2024 Klarna’s Soaring Debut Sets the Tone for BNPL and IPO Revival — But Risks Lurk^[2]. However, the company will need to navigate profitability pressures and prove that BNPL is more than a short-term pandemic-era phenomenon to cement its rebound Klarna’s Soaring Debut Sets the Tone for BNPL and IPO Revival — But Risks Lurk^[2].