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Sweden's Klarna Gets Full Banking License
6/19/2017 10:03 AM

Klarna, a Swedish payments startup, said it has been granted a full banking license by the Finansinspektionen, the Swedish Financial Supervisory Authority. The company noted that the license will enable it to broaden its product portfolio for customers and merchants across Europe.

Sebastian Siemiatkowski, CEO of Klarna said, "As the entire banking value chain is being challenged, the payments sector has seen the most profound transformation. Klarna has played a role in disrupting payments services for the better and now as a consumer-oriented, product driven and technology intensive bank, we have the tools to drive change in retail banking."

Founded in 2005 in Stockholm, Klarna provides payment solutions for 60 million consumers across 70.000 merchants. The company, one of Europe's most highly valued startups, is active in 18 markets with more than 1,500 employees.

Klarna is backed by investors such as Sequoia Capital, Bestseller, Atomico and General Atlantic. The company has changed its legal name to Klarna Bank, but will continue to operate in the market as "Klarna".

According to its website, Klarna manages payments for e-commerce companies and handles around 450,000 transactions per day.

Klarna's new range of new banking products and services could include issuing payment cards, and moving into products to become an all-in-one digital wallet. Currently, Klarna offers direct payments, pay after delivery options and installment plans.

In early June, Klarna said that Brightfolk A/S, a company held by Anders Holch Povlsen, will acquire a strategic equity stake in the company.

Povlsen is the owner of European fashion company Bestseller, which owns fashion brands such as Jack & Jones, Vero Moda, Only and Selected. In addition, Povlsen has significant holdings in e-commerce fashion sites such as Asos and Zalando.

Klarna has said it recorded strong transaction volume growth in the first months of this year, building on a 50 percent increase in transaction volumes in 2016.
The company noted that the growth was partly driven by 17,000 new merchants across markets. In addition, twelve million consumers tried Klarna's products for the first time in 2016.

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