Klarna plans to replicate the success of super apps in the United States.
Klarna Aims to Transform into a Comprehensive Super App
Klarna, the Swedish fintech company known for its buy now, pay later (BNPL) products, is planning to expand its services beyond BNPL and into the realm of a super app. This ambitious move aims to create a platform that can manage every aspect of a user's financial life and many non-financial services, similar to the success seen with Ant Group's Alipay and Tencent's WeChat Pay in China.
The super app model allows users to handle everything from payments and messaging to shopping all within a single, one-stop platform. Klarna's AI-powered platform is designed to cut through the clutter in the crowded super app ecosystem and personalize the user experience.
One of the new services Klarna is introducing is mobile phone plans. These plans, now available in the U.S., feature unlimited data, calls, and texts. The AI-powered platform can even guide users through their everyday banking needs and suggest more cost-effective solutions if it determines the user is paying too much for their smartphone plan, facilitating the switch to a new provider.
However, Klarna faces several major concerns and challenges in its attempt to build a super app platform. Rising credit losses and financial strain are a significant concern, with Klarna reporting a 17% year-over-year increase in credit losses as of Q1 2025. This financial strain is exacerbated by high operating costs and difficulty reaching profitability.
Increasing regulation in major markets also poses a challenge, as it imposes licensing requirements, affordability checks, strict fee disclosures, and dispute resolution standards, which add compliance costs and may pressure margins. For instance, New York's BNPL Act and revised EU Consumer Credit Directive place tougher obligations on Klarna.
Competitive pressures are another hurdle Klarna must overcome. The company competes not only with BNPL peers like Affirm and Afterpay but also with traditional banks like JPMorgan Chase and Citi that have launched competing card-linked installment products. This competition fragments the market and complicates Klarna’s growth efforts.
Technical and product expansion complexity is another challenge. Klarna’s ambition to evolve from BNPL to a comprehensive super app integrating mobile services and other non-financial offerings involves significant technology integration, risk management, and user experience challenges. Its planned IPO aims to fund these initiatives.
The BNPL market is moderately fragmented with players focusing on different verticals and geographies. Klarna’s ability to master compliance, fraud mitigation, and technology adaptation will be key to expanding beyond core BNPL services into a super app ecosystem.
Despite these challenges, Klarna's goal is to become a digital financial assistant, much like the AI agents in Visa and Mastercard's agentic commerce solutions. The company's plans for a debit card further serve to drive it beyond its BNPL roots.
However, the super app model has been criticized because it can create closed platforms that may stifle growth, especially in tough economic conditions. Some view the acceptance of payments from WeChat Pay on Alibaba's e-commerce platforms as a sign that the super app concept is losing steam.
Regardless, Klarna remains committed to its goal of becoming a leading super app, aiming to provide users with a seamless, personalized, and comprehensive financial experience.
[1] The Information [2] Bloomberg [3] CNBC
- Klarna's goal to become a digital financial assistant, as demonstrated by its plans for a debit card and AI-powered platform, extends its business beyond finance and technology, diving into the complex world of comprehensive business services.
- As Klarna expands into mobile phone plans and aims to create a super app, it encounters challenges not only in technology integration but also in finance, such as rising credit losses, high operating costs, and strict regulatory compliance, particularly with the New York BNPL Act and the revised EU Consumer Credit Directive.
