Do you want to buy something now but do not want to pay for it until later? Klarna (buy now, pay later) lets you do that. They offer many features including, no interest (or low interest) payments for up to 30 days and a quick decision on approval of the purchase. It means that you can get your items faster and more!
What is Klarna?
Klarna is a newer company that has gain popularity in a short time. Millions of customers and merchants worldwide use the Klarna app to help them sell their items. It is used at all levels, from small eBay sellers up to large companies like Amazon.
For individual users, this app provides services on websites like Craigslist, Gumtree and other small businesses. Klarna has set itself apart from other payment processors by offering this new and unique way. It attracts both parties-
- The merchants who want more customers
- Consumers looking for an easier way to buy things they need or desire.
One example of this is their way of allowing customers to buy things online with no interest attached. Other payment processors such as PayPal, Amazon Payments and Google Wallet all offer a similar service, but the catch is that you are still required to pay back what you owe over time at high rates of interest.
How Klarna Works
The way that Klarna works are very similar to the more traditional forms of credit. If you want to buy something, all you have to do is place your order and wait for it to arrive at your door (or in-store).
Once it arrives, however, rather than having a set date by which you should make the payment or pay interest, you have a “14-day payment window” in which to pay for your product.
Klarna works with retailers rather than individual customers. It ensures that they can provide the service on any website, which is part of their network (which includes thousands).
How Klarna Makes Money
So, it is clear that klarna (buy now pay later) works very much in consumers favours, but what about retailers?
Klarna charges a fee for each successful transaction that is taken directly from the retailer once payment has been received.
Along with the basic fees, they also charge additional fees based on whether or not you return your product. Also, if you pay online or in-store (the latter being more expensive) brings a difference.
As with all credit providers, Klarna makes their money by charging interest to customers who don’t repay within 14 days; however, they aim to be different by encouraging customers to use the service to prevent them from falling into debt.
How can I get started with Klarna’s great payment system?
To start using klarna (buy now pay later), simply register an account here. Once registered, use the search tool on their website to find retailers who accept klarna payments online and in-store. You can then click through to these merchants, start adding your items to the shopping cart and follow the steps like any other online purchase.
Once payment is requested, klarna will take care of all processing. It includes-
-confirming that the bank account details provided are correct (ensuring security)
-checking creditworthiness according to predetermined criteria
– reserving funds in advance from your nominated card(s) or direct debit authority, if required
It means that no interest charges apply while stock remains with Klarna. In addition, instead of having an individual itemised invoice sent via email, it comes as one simple statement each month. This ultimately makes things easy if anyone needs to claim their goods under warranty when they come back to you.
Which stores accept Klarna?
Klarna can be used at both physical and online stores. Currently, there are over 200,000 stores throughout Europe that accept the service.
Klarna offers a free trial of their payment system, and they will refund you if anything goes wrong with your purchase. Therefore, it is worth finding out more about them before making any big purchases to avoid being charged extra fees by another company.
What platforms does Klarna work with?
The Klarna app works with numerous platforms, including some larger ones like Apple and Google. They also work with small businesses to let them accept PayPal, debit and credit cards on their existing websites instead of having to build one of their own.
How many days does Klarna give for repayment?
For physical stores: You have 14 days from when your item arrives to pay for it (or up until 30 days after delivery). If you decide not to keep the item, then try returning the items as soon as possible to ensure that it is done within these timescales. This way, you won’t get charged interest which can vary between 16% – 29%.
What fees does Klarna charge?
As mentioned, there are various ways in which Klarna charges additional fees. However, this will vary depending on the retailer and whether or not payment is made online or in-store. The basic fee charged by klarna per successful transaction ranges from £0 – £12, plus an extra 0-15% based on whether or not you return your product. If paid in-store then again another percentage can be added onto these rates: typically around 20%.
Does Klarna require a minimum credit score?
Klarna is a credit company. So, it doesn’t matter what your score is as they look at factors other than that to determine if you’re eligible for the service.
Are there any benefits of using Klarna (buy now pay later)?
Klarna, buy not only saves you money but also time! There’s no need to worry about paying bills or clearing your credit score as klarna will take care of all this for you. In addition, the fast-track delivery service offered by Klarna means that once ordered and paid for (either in-store or online). The product should arrive within a few days – perfect if there is a last-minute Christmas gift!
For businesses, it’s great because they get access to a large new customer base who might not have been able enough before to buy from them online.
What can we expect next from Klarna?
There are a few things we can expect in the future from Klarna. For one, they’re developing their e-commerce platform called Pay Later, which should help to improve the shopping experience for customers and merchants alike.
Are there alternatives to Klarna?
Yes, there are several other ways to pay. You can use Afterpay, ZipPay and Certegy Ezi-Pay. But they all have their requirements, like having a certain amount of money or you can only buy certain things with them. So it’s worth checking before you sign up with anyone just in case they don’t work for you.
The Downside of Klarna, Buy Now Pay Later
Of course, there are a few downsides of buy now, pay later. The biggest downside is that you might not be allowed to buy an item if the total cost is above your credit limit, so make sure you keep track of what’s on your card and don’t go over it!
Another potential problem with this option could arise from something known as “date mismatch.” It happens when the merchant sends their payment request before they ship out the product or complete service. In this case, Klarna will put off charging your account until after 30 days for regular purchases and 90 days for rentals and recurring services.
In the end, this is a great way to save money and get more time for your payback. Another drawback is that you must have an account with Klarna already to use it. It means they will run a credit check on you and ask for some personal information like your name and address for their records. But if you’re not comfortable giving them any of this, then just stick with PayPal! They don’t require nearly as much information from users, so there are no worries about having too little or incorrect information on file. Plus, when making online purchases at all kinds of different stores, PayPal can be used pretty much anywhere without hassle while Klarnas tends to work best with certain specific types of merchants (i.e., those that have a European presence).
Conclusion
Klarna can make your life easier by helping you get more sales and letting you know what customers are buying. They also offer a free trial, so sign up today to see how they work for you!