Today, Klarna, a Swedish fintech startup, has announced a global partnership with H&M, the fashion powerhouse, which included an investment of $20m (£15.3m) in the business.
The partnership will see Klarna integrate its digital payments technology into the physical and online stores of H&M via H&M Club1, its payment programme.
Klarna enables the shoppers to pay for products online securely with flexible payment options including its “try before you buy” Pay Later service. With the options, the users are able to shop without having to pay the retailer for a maximum of 30 days, interest-free. The partnership comes after the other deals that Klarna formed with brands such as Topshop, Asos, and JD Sports.
The said partnership is anticipated go live in Sweden and the UK next year, prior to a global roll out.
Even though no valuation is being disclosed after this most recent investment, in 2017, Klarna was last valued at $2.5 billion. The other backers of the business include Anders Holch Povlsen. He is a Danish billionaire who also retains a stake in Funding Circle, a peer-to-peer lender. Northzone, an investor of Spotify, has also rendered early backing for the company. Visa also owns a strategic stake in the firm.
While plans for an IPO or potential float locations are yet to be confirmed, Michael Rouse, the chief commercial officer of Klarna, disclosed that the startup is committed to achieving growth and acceleration of its business, while being proud of its European heritage.
Rouse stated: “We have global ambitions.”
He continued: “But an IPO is not a driver in any of those decisions.”
When he asked if the United Kingdom remains to be considered as a strong location for Klarna, Rouse answered: “We look for talent to grow our business, and want to make sure we’re based in the right locations to access that talent.”
He added: “We’re highly committed to the UK business, which is another example of the growth and acceleration we’ve seen in the UK over the last two years.”
He pointed out that he had just relocated to London himself in order to improve the presence of Klarna in the United Kingdom.
He continued: “We’re very much invested in our London operations […] It’s an exciting time to be here with all the development and talent at our disposal in this market.”
The fintech startup announced that it had acquired Close Brothers Retail Finance, the point-of-sale funding arm of Close Brothers Group that is based in the United Kingdom, last month.