Swedish FinTech unicorn Klarna has launched consumer bank accounts in Germany.
Only a limited number of users will be able to tap into the new service at the start, but Klarna plans to roll out the service to other German consumers over the next few months.
Klarna’s new banking service will come with a Visa debit card that can be connected to both Google Pay and Apple Pay.
Users will also be able easily track their expenses in the Klarna app.
“Our focus is to provide a superior shopping experience to our consumers at the intersection of retail and banking,” said Sebastian Siemiatkowski, CEO of Klarna.
Klarna claimed that the new service will be able to meet the demand for digital banking services that it said incumbent banks have been unable to meet.
“And we know that there’s still massive room for improvement to the way many people bank and save their money today,” Siemiatkowski said. “Users are demanding more seamless, intuitive and transparent services to meet their daily needs, but many banks still do not cater for this. We are very excited to introduce Klarna Banking today, bundling shopping and banking in one app and allowing our consumers to bank in the same seamless way as they shop with Klarna.”
The new banking service will enable users to sign up the service in a compliant way using Klarna’s KYC process. Whilst video identification is possible, Klarna said it is not necessary.
Users will also be able to transfer from and top up their accounts with three clicks.
The new service will also include budgeting services, cash withdrawals from ATMs and direct debit payments or bank transfers available for all 36 countries of the SEPA area.
With the launch of its banking services, Klarna will compete against German challenger banks such as N26 and other neobanks that are available in the country such as Revolut and Vivid Money.
For the last months of 2020, Klarna held the title of being Europe’s most valuable privately-owned FinTech after it achieved a $10.65bn valuation on the back of a $650m funding round in September.
Checkout.com claimed the title in January after closing a $450m Series C funding round at a $15bn valuation.
Siemiatkowski has recently hinted that Klarna may soon go public. The recent naming of venture capital firm Sequoia Capital’s Michael Moritz as the company’s new chairman and board members is seen as a big push towards that goal.
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