Klarna, the Swedish fintech best known for its buy now, pay later products, announced yesterday that it has applied to the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation to establish Klarna Bank USA.
Why it matters: Klarna’s move is the latest signal that the line between fintech lenders and traditional banks is disappearing. As BNPL providers convert themselves into chartered, deposit-taking institutions, the credit they originate, and the delinquencies that follow, will increasingly sit inside regulated banks rather than partner-bank arrangements. That has implications for who services and collects on those accounts, how those receivables are regulated, and which compliance frameworks apply.
The big picture: Klarna has held a European banking license since 2017 and has served U.S. customers since 2019 through partner banks, most notably WebBank. The company says it has extended more than $91.3 billion in credit to American consumers over that period and now counts 30 million U.S. users annually, out of more than 119 million active users worldwide.
If approved, Klarna Bank USA would operate as a wholly owned subsidiary of Klarna Inc., with its own independent board, governance, and internal controls.
Between the lines: A charter would let Klarna fund loans with its own customer deposits instead of costlier wholesale financing, offer checking accounts and credit cards directly, and shed its dependence on sponsor banks. Klarna co-founder and CEO Sebastian Siemiatkowski framed the application as a bid to bring more competition and transparency to U.S. banking, saying customers want tools to borrow responsibly and build financial confidence.
The trend:
