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Klarna
A leading BNPL and payments provider offering Pay in 3, Pay in 30, and full checkout solutions for UK ecommerce brands looking to boost sales and loyalty.
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Exclusive Rates From as Low as 0.26%
What is Klarna?
Klarna is a Swedish fintech company best known for pioneering Buy Now, Pay Later (BNPL) services across Europe. Launched in 2005 and active in the UK since 2014, Klarna enables customers to split payments into instalments, delay payments, or pay in full at checkout, all while merchants get paid upfront.
For UK ecommerce businesses, Klarna provides a complete suite of tools beyond Pay in 3. Merchants can access Klarna’s fully hosted checkout, on-site messaging, analytics, fraud protection, and customer insights. Klarna is used by brands like ASOS, H&M, and Gymshark, and integrates easily with platforms like Shopify, WooCommerce, Magento, and BigCommerce.
At Compare Card Fees, we help retailers evaluate Klarna’s offerings, optimise their checkout setup, and compare BNPL with alternative finance or payment gateway providers.
Key Features of Klarna
Who Is Klarna Best Suited To?
Klarna is ideal for:
- Ecommerce stores looking to increase conversion and average order value
- Retailers with younger, mobile first audiences
- Fashion, beauty, lifestyle, and fitness brands
- Merchants with higher average basket values (typically £75+)
- Subscription or repeat purchase businesses seeking loyalty
It’s less suitable for:
- B2B or invoice based businesses
- Low ticket merchants or high risk sectors
- Physical only retail without ecommerce
Klarna Pricing & How It Compares
Klarna charges merchants a transaction fee and a variable commission based on the payment option selected:
- Fixed fee per transaction: typically £0.20–£0.25
- Variable fee: around 2.9%–5.9%, depending on product (Pay Now, Pay in 3, Pay Later)
While Klarna is more expensive than a standard payment gateway, it often delivers higher conversion rates and larger average basket sizes. For many brands, the boost in revenue offsets the higher processing cost.
Compared to PayPal Pay Later or Clearpay, Klarna offers more flexibility, a broader set of merchant tools, and a large UK user base. Through Compare Card Fees, we can help determine if Klarna is right for your audience and how it fits with your wider checkout strategy.
Pros and Cons of Klarna
PROS
Trusted by millions of UK shoppers
Full fraud and credit risk protection
Seamless integration with ecommerce platforms
Marketing and checkout tools included
Cons
Higher fees than traditional gateways
Not suitable for all business models
BNPL regulation may affect future terms
FAQs about Klarna
Klarna is a payment service provider that enables Buy Now Pay Later options like Pay in 3 and Pay in 30, along with a full checkout suite for ecommerce merchants.
Yes. Klarna pays the merchant at the point of sale, even if the customer chooses to delay or split payments.
As of 2025, Klarna operates under temporary permissions with the FCA, and full regulation of BNPL is expected soon.
Klarna integrates with Shopify, WooCommerce, BigCommerce, Magento, Wix, Salesforce Commerce Cloud, and more.
Yes. Klarna typically charges 2.9% to 5.9% + a fixed fee, higher than standard card gateways, but it often boosts conversion enough to justify the cost.
Yes. Klarna offers POS and QR-code based payment options for physical retail locations, depending on your provider.
It can be, especially if you sell products online with an average order value over £75 and your customers prefer flexible payment options.
Pay in 3 splits the purchase into three monthly instalments. Pay Later allows customers to pay in full within 30 days.
No. Klarna’s consumer facing products (Pay in 3 and Pay Later) are interest-free. Klarna makes money by charging merchants.
Yes, we can assist you in integrating Klarna, optimising your checkout, and comparing Klarna with other finance and payment options.
Is Klarna Right for Your Business?
Klarna is more than a BNPL provider, it’s a conversion engine for modern ecommerce. If your business sells online and wants to offer flexible payments that shoppers trust, Klarna is one of the most powerful tools available.
Its higher fees are often justified by increases in revenue and brand loyalty. Klarna is particularly valuable for brands selling fashion, beauty, fitness, and lifestyle products online.
To find out if Klarna is a fit for your store or to compare it against other flexible payment options, speak to our team.
Still exploring options? Compare UK payment providers here to find the best fit for your business.
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