Klarna, the Swedish fintech known for its buy now, pay later services, has applied for a bank charter in the U.S., which, if approved, would allow it to operate as Klarna Bank USA, backed by the Federal Deposit Insurance Corporation and chartered in Utah.
This move is led by Gary Harding, a former CEO of two banks, and is seen as a response to the growing demand for more transparent financial services in the U.S. According to Sebastian Siemiatkowski, Klarna's co-founder and CEO, the bank would provide customers with tools to borrow responsibly and enhance financial confidence while fostering competition and innovation in the market.
This application reflects a broader trend among fintech companies, which are increasingly seeking their own banking charters to gain advantages such as funding loans through customer deposits rather than relying on more costly wholesale financing.
Klarna's recent introduction of high-yield savings accounts, although currently held by a partner bank, indicates its ambition to evolve into a full-fledged consumer bank. Since going public last September, Klarna's stock has halved from its IPO price of $40, highlighting the challenges it faces in the competitive fintech landscape