back Back

Klarna launches BNPL Credit ‘Opt Out’ tool for users in the UK

By Gloria Methri

May 25, 2023

  • Budgeting
  • Buy Now Pay Later (BNPL)
  • Credit Card
Share

Klarna, Payments, UK, FinTech, Credit Opt Out, Credit CardKlarna, the global payments network, and shopping destination, has launched a voluntary credit ‘opt out’, an additional tool in the Klarna app to help consumers save time and money. The new feature will help consumers ‘pre-decide’ not to use credit while saving for a specific life event or sticking to a very strict budget.

The feature was initially suggested by Andrew Griffith MP, UK Economic Secretary to the Treasury in a meeting with Sebastian, Klarna’s CEO and co-founder.

“As a leader in responsible credit, we always put our customer’s interests first,” said Sebastian Siemiatkowski, Klarna’s Co-founder, and CEO, “Unlike credit card companies, who push you to put all your purchases on credit, we believe that consumers should only use credit when it makes sense for them. That is why I loved Andrew’s suggestion of a voluntary credit ‘opt out’, so people are in control of their finances.”

Andrew Griffith MP, Economic Secretary to the Treasury, said, “As this government seeks to protect UK borrowers by bringing forward proportionate regulations for Buy-Now-Pay-Later products, I welcome this initiative which shows how a responsible business can use innovation to help protect vulnerable customers.”

To activate the credit ‘opt out’, consumers can enter the ‘settings’ tab in the Klarna app and select, ‘deactivate credit’. Once credit has been deactivated, consumers are taken to a page of resources and support for those dealing with indebtedness and they will no longer be able to use Klarna Pay in 30, Pay in 3, or Financing products. To reactivate credit services, consumers will need to call Klarna’s customer service teams. The opt-out is available in the latest version of the Klarna App.

Klarna lends to those who can afford to repay by conducting strict eligibility checks on each transaction, unlike credit cards, which give a real-time view of a consumer’s financial circumstances. When a customer misses a payment, Klarna will automatically restrict access to credit services to prevent debt building up. All these measures lead to losses that are less than 1%, 30-40% lower than credit card companies.

Previous Article

May 25, 2023

Marstone & Red River Credit Union partner to offer wealth management services

Read More
Next Article

May 25, 2023

OpenFin raises $35m in Series D investment

Read More






IBSi Daily News Analysis

Complaints Fraud

May 22, 2024

Budgeting

UK SMEs lack fraud protection, facing significant financial risks, study shows

Read More

IBSi FinTech Journal

  • Most trusted FinTech journal since 1991
  • Digital monthly issue
  • 60+ pages of research, analysis, interviews, opinions, and rankings
  • Global coverage
Subscribe Now

Other Related News

May 22, 2024

Sabre Hospitality and Uplift partner to offer flexible hotel payments

Read More

May 22, 2024

American Express & Emburse bring integrated expense management solutions to SMEs

Read More

May 22, 2024

SurePay teams up with FIS to deliver Verification & CoP solutions

Read More

Related Reports

Sales League Table Report 2023
Know More
Global Digital Banking Vendor & Landscape Report Q1 2024
Global Digital Banking Vendor & Landscape Report Q1 2024
Know More
Wealth Management & Private Banking Systems Report Q1 2024
Wealth Management & Private Banking Systems Report Q1 2024
Know More
IBSi Spectrum Report: Supply Chain Finance Platforms Q4 2023
Know More
Treasury & Capital Markets Systems Report Q1 2024
Know More

IBSi Sales League Table

The industry acknowledged barometer of global banking technology vendor performance!
Get your copy now!
close-link
Get your copy now! IBSi Sales League Table 2023