News

CBA Invests $200M In Klarna For Australian Rollout

The Commonwealth Bank of Australia (CBA) has invested $200 million in the Swedish FinTech unicorn Klarna, the buy now, pay later service for shoppers, both companies announced on Thursday (Jan. 30). 

CBA gave Klarna an initial investment of $100 million in August. This new funding is at the same valuation — $5.5 billion — and is intended to bring CBA additional rights and exposure to Klarna’s international growth. The total investment raises the bank’s shareholding in Klarna to 5.5 percent, up from its initial 1.8 percent stake. 

Klarna’s official rollout in Australia introduces the Klarna shopping app. CBA app users will be the first to try the online shopping service by connecting the Klarna app to a CBA account. Klarna allows shoppers to pay for purchases in four equal installments with no interest or fees for on-time payments.

“Australian consumers’ expectations are evolving, they demand seamless, intuitive and transparent online shopping services that better meet their daily needs,” said Sebastian Siemiatkowski, chief executive officer and co-founder, Klarna. “This partnership with CBA is rooted in a shared obsession on how good digital experiences can truly serve consumers today.” 

Klarna was founded in 2005 and has raised a total of $1.4 billion in funding. Its $5.5 billion valuation makes it the most valuable privately-held FinTech in Europe. It counts the U.S. rapper Snoop Dogg — who was featured in a Klarna advertising campaign — among its many investors. 

“We are excited to be partnering with Klarna to bring their innovative payments technology and integrated shopping experience to the Australian market. Together with our market-leading digital technology, merchant relationships and strong customer network, we will deliver a range of innovative new services to benefit Australian consumers and merchants,” said Matt Comyn, CEO of CBA.

Siemiatkowski said in December that Klarna has been adding about six million new customers each year. The firm has about 3,000 employees in 17 countries. 

Leave a Reply

Your email address will not be published. Required fields are marked *