The buy now, pay later giant Klarna is poaching into banking with launching its first current account.
Klarna is also allegedly worth $25-30bn with closing a new $500m, three sources with insight told Breakit.
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The company will initially offer selected German customers the opportunity to open an account. To do this, the FinTech uses its Swedish banking license, with which it can offer banking services across the EU.
“Our focus is to provide a superior shopping experience to our consumers at the intersection of retail and banking,” said Klarna CEO Sebastian Siemiatkowski.
For example, users have the option of setting up fixed budgets for certain shopping categories in order not to waste too much money in the shopping frenzy. The account is secured using biometric identification data such as fingerprint and face recognition.
“Klarna is built on digital account openings and AI,” said Richard Crone, a payments consultant. “Most legacy banks don’t have those capabilities, especially community banks and credit unions.”
Klarna’s bank accounts will allow users to pay with a Visa card, or use Apple or Google Pay.
The Swedish BNPL provider has raised $650 million in funding led by Silver Lake with the valuation of the company hitting $10.65 billion last year.
“Klarna is one of the most disruptive and promising fintech companies in the world, redefining the eCommerce experience for millions of consumers and global retailers, just as e-commerce growth is accelerating worldwide and rapidly shifting to mobile,” said Jonathan Durham, managing director of Silver Lake Partners, in a release announcing the deal last year.
If the funding of $500m would be confirmed, this would mean Klarna has raised $1,15bn during just a year.