The facility size is $1bn and over the course of the 2-year term of the agreement, as underlying assets amortize, new loans will enter the facility. In this way, Klarna expects the agreement to facilitate the origination of $6.5 bn-worth of loans.
Klarna, the global digital bank and flexible payments provider, announced that investment funds managed by Elliott Investment Management, a U.S.-based investment firm, will purchase Klarna’s U.S. Fair Financing loans, supporting the continued expansion of this product in the United States. The companies expect to facilitate a total of $6.5bn-worth of loans over the two-year term of the agreement.
The agreement enables Klarna to sell part of its existing Fair Financing portfolio and, from October onwards, newly originated Fair Financing receivables to the Elliott-managed funds on a rolling basis. The transaction provides scalable, off-balance-sheet funding to support Klarna’s growing U.S. consumer credit business, while delivering strong returns and improving the company’s financial flexibility and long-term capital efficiency.
The back-book sale secures immediate revenue realization and enables full facility utilization early in the program. The forward flow structure offers predictable funding economics and underscores Klarna’s ability to design and execute large-scale capital markets transactions that align funding with the company’s risk and growth strategy. Klarna will still own all consumer-facing activities, including underwriting and servicing.
“This is another major step in our U.S. growth journey,” said Niclas Neglén, Chief Financial Officer at Klarna. “Fair Financing puts people in control, giving them real choice and flexibility with clear terms and no surprises. This agreement lets us reach even more Americans who are moving on from traditional credit and choosing fairer ways to pay.”
Klarna Fair Financing is growing quickly and taking significant market share in the U.S. fixed term installments market. Fair Financing GMV has grown by 139% globally, and 244% in the US, over the past year, and today’s agreement enables Klarna to support similar growth into the future.
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Klarna is a global digital bank and flexible payments provider. With over 111 million global active Klarna users and 2.9 million transactions per day, Klarna’s AI-powered payments and commerce network is empowering people to pay smarter with a mission to be available everywhere for everything. Consumers can pay with Klarna online, instore and through Apple Pay & Google Pay. More than 790,000 retailers trust Klarna’s innovative solutions to drive growth and loyalty, including Uber, H&M, Saks, Sephora, Macy’s, Ikea, Expedia Group, Nike and Airbnb. Klarna is listed on the New York Stock Exchange.
Banking 4.0 – „how was the experience for you”
„To be honest I think that Sinaia, your conference, is much better then Davos.”
Many more interesting quotes in the video below:
