London, 23 November, 2023 – Klarna, the AI-powered payments network and shopping assistant, has been authorised by the UK’s Financial Conduct Authority (FCA) to provide regulated payments and credit services in the UK. 

Following Brexit, Klarna Bank AB, a fully licensed Swedish Bank, continued to provide regulated services in the UK under the FCA’s Temporary Permissions Regime (TPR). As the TPR will expire on 31 December this year, Klarna has established a new, UK-based entity, Klarna Financial Services UK which will provide all consumer-facing services in the UK. 

The FCA authorisation applies to Klarna’s regulated credit and payment products. Klarna’s short-term interest-free BNPL products remain outside the scope of the Consumer Credit Act, but Klarna has long argued that they should be regulated to protect consumers from bad actors, while continuing to have access to low cost credit. 

“Klarna has always operated under the oversight of the FCA, delivering our regulated products to a very high standard of customer care. As well as enabling us to continue to provide our regulated products, the FCA approval puts Klarna’s successful UK business on a secure regulatory footing ahead of the expected regulation of BNPL,” said Abby Vickers, Head of Klarna Financial Services UK.     

Klarna has constantly driven high standards of consumer protection and its credit products are built to give consumers a fairer, and more sustainable way to access credit for those who need it. The company conducts strict eligibility checks on its regulated credit products to ensure it only lends to those who can afford to repay. When a customer misses a payment, Klarna will automatically restrict access to credit services to prevent debt building up. 

Notes to editors:

• The FCA approval applies to Klarna’s regulated services:
  • Klarna Term Loan and Klarna Card are regulated credit products. 
  • Klarna Card, One-time card, Instore card and open banking-based payment services are all regulated payment services. 
• As short-term, interest-free credit remains exempt from the Consumer Credit Act, this approval does not apply to Klarna’s BNPL products.