8.6 C
New York
Sunday, November 27, 2022
Home Fintechs Klarna has tightened lending during the lockdown

Klarna has tightened lending during the lockdown

Buy now, pay later service Klarna has seen a boom in business during Britain’s lockdown. However, it tightened its rules on lending as a result of the financial uncertainty caused by the UK’s lockdown as well.

The following numbers reflect which categories have seen the biggest boom: 105% increase in the number of running shoes purchased using Klarna’s services, a 60% hike in beauty product sales, and “significant uplift” in purchases of bicycles and cycling accessories.

Read also: Klarna unveils ‘KlarnaSense’ – A new initiative to encourage smarter shopping

“We saw our volumes increase during that period just reflecting the increase in digital transactions generally,” Luke Griffiths, Klarna’s vice president, told BBC Radio 5 Live’s Wake Up To Money.

However, as sales increased but more shoppers faced the financial uncertainty of lockdown, the company did tighten its rules on lending.

“Obviously with people’s financial circumstances changing during this period, we have constantly reviewed our policies around the type of customer that we accept,” Mr. Griffiths said.

In a recent survey, Klarna found out that over two thirds (67 %) of shoppers use the service to help manage their finances and spread the cost of more expensive purchases, and almost half (49 %) used the ‘try before you buy’ for convenience.

Luke Griffiths also says the firm is only accepting customers who it believes will and can repay on time. As a result, he does not believe Klarna will see an increase in defaults, despite rising levels of financial hardship.

Jan Cerny
Jan is an innovation enthusiast and Fintech news reporter. He specializes in news distribution, social media, and content analysis.

Recent posts

N26 study shows Spain has the highest savings ratio in Europe

N26 has recently analyzed the data of over 380,000 consumers in the main five European markets (Spain, Germany, Austria, France, and Italy), with the aim of discovering the saving and spending trends in 2022.

The UK Startup Atoa Payments has raised $2.2 million in a pre-seed funding round

Recently, the UK startup Atoa Payments has raised $2.2 million in a pre-seed funding round.  The interest in the...

Only 60% of fintechs are product-led according to a recent survey of 100 fintech product specialists

A recent global survey of 100 fintech product specialists from fintech brands like Wise, AMEX, and more, revealed that whilst 90% of fintechs have dedicated product teams, only 60% of them are considered to be product-led. 

INNOVATION IN THE WORLD OF CREDIT CARS

It’s a well-known fact, banks that do digital transformation get more clients. Sella decided to join the number of innovators and launched...