Klarna & UATP team to tap into air travel payments industry

By Gloria Mathias

UATP, the global payment network, has announced a partnership with Klarna, the AI-powered global payments network.

The partnership allows airlines to offer Klarna’s flexible payment services, including interest-free BNPL, to customers, providing them with more flexible payment options for travel products and services.

UATP’s collaboration with Klarna represents the convergence of two successful payment technology companies journeying towards a mutually beneficial partnership. Klarna gains immediate access to UATP’s vast base of airlines and travel agencies and is a preferred BNPL partner for the EU and APAC.

For UATP, integrating Klarna further strengthens the payment network’s support for BNPL options. Offering a variety of BNPL choices helps UATP merchants tap into a global BNPL market estimated at $14.55 billion this year and is expected to grow at a CAGR of 26.50% to reach $60.47 billion by 2030.

“BNPL is an essential payment option for travel merchants to provide their customers. It offers flexibility and convenience to encourage travellers to complete transactions and boost conversion rates,” said Zach Ornelas, SVP of Global Sales for UATP. “But to reap the full benefits of having this payment option, merchants need a BNPL partner that their customers know and trust. Klarna is that partner.”

Klarna’s BNPL is a short-term, interest-free credit service with no fees when paid on time. Klarna underwrites every transaction based on strict eligibility assessments and boasts a 99% repayment rate globally. This model provides consumers with a transparent and predictable repayment structure, making it easier to manage their finances without accumulating interest.

By leveraging UATP’s existing connections and expertise in alternative forms of payment, the partnership between UATP and Klarna enables airlines and other travel merchants on the UATP network to introduce BNPL more quickly, eliminating resource-intensive implementation work and lowering the cost per transaction. It also allows Klarna to quickly access the travel merchants connected to the UATP network, expanding their exposure to the travel vertical and enhancing their growth opportunities in this sector.

“Travel is perfect for interest-free buy now, pay later, allowing travellers worldwide to spread the cost of their trips and without getting stuck paying sky-high credit card interest rates,” shared Erin Jaeger, Head of North America, Klarna, “This agreement with UATP means we can quickly bring these benefits to many more airlines and tap into the huge growth opportunity which the $1 trillion travel industry represents for us.”