The European payment solution Klarna, founded in Sweden, has had great success in Europe and especially in the Nordic countries. In Sweden you basically need Klarna as an online shop, similarly as you have to accept the Dankort to do business in Denmark.
Klarna's payment solution is based around the fact that you don not pay until after you have received the goods bought online. This simple idea has created a new payments company with a valuation of $2.25 billion. Klarna also has a greater plan to take on retail banking, but its core business is to make online transactions as frictionless as possible.
"Run Rate of Over One Billion Dollars"
The true test, in the eyes of many people, is as always the US market. Will Klarna's payment service, based around billing the customer after the purchase, gain traction in the US?
According to Klarna's latest figures they are the fastest-growing payments company ever in entering the US market.
- In December we will be looking at a run rate in GMV of over one billion dollars, and that is after launching in September. It is the fastest-growing payments company ever in the US, in that we have reached the volume faster than for example PayPal, Visa or Amex did, said Erik Engellau-Nilsson, CMO at Klarna.
Klarnas founder and CEO, Sebastian Siemiatkowski, gives us his explanation as to how they have had such a successful entry into the US. A market that many would put as extremely competitive when it comes to online payments.
- We have been working for several years to carefully prepare our launch. We have made a number of key recruitments and put a tremendous amount of time into ensuring that our checkout solution is tailored to the US market. We have for more than ten years worked very closely with Swedish merchants, who in many ways are world leaders, and it is rewarding to apply these lessons learned abroad, said Sebastian Siemiatkowski.
He does however add that it is still early in their launch and the most important thing now is to add value for the US merchants. Klarna launched with Overstock.com as their first big customer. Shoes.com is another example that Sebastian Siemiatkowski gives us.
Today they have a dozen merchants that use their checkout solution, Klarna Checkout, in the US and they are working closely with the platforms Shopify, Magento and Demandware to enable a lot more integrations during 2016.
Klarna's American CEO, Brian Billingsley, have previously said that they hope to sign hundreds if not thousands of e-commerce sites during the next year.