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28 Feb 2022

Klarna announces Full Year Financial Results 2021

Klarna now connects 147m active consumers with over 400k global retailers, driving 2021 merchandise volumes to USD 80bn

Stockholm, 28 February 2022Klarna, a leading global retail bank, payments, and shopping service that helps consumers save time and money, be informed and in control, today announced its financial results for 1 January to 31 December 2021. 

Gross merchandise volumes reached record levels of USD 80 billion driven by growth in all global markets. 147 million consumers now choose Klarna to bank, shop, and pay with 46 million consumers added through 2021 acquisitions, extending Klarna’s global reach to 45 countries. Net operating income increased 38% to USD 1.6 billion. 

The US continues to be Klarna’s fastest-growing key market by volume and now Klarna’s second-largest by revenue, much of it fuelled by the app’s success and strong retail partnerships. Klarna partners with 30 of the Top 100 US retail brands and new partners in 2021 include Net-A-Porter, PetCo, Lululemon, Bed, Bath and Beyond, Bloomingdales, Macy’s, Converse, Ralph Lauren, Fitbit, Pandora, Nike, Dickies and Wix.com as well as over 50 global luxury and premium retailers. US merchandise volumes have more than tripled year on year (YoY), fuelled by 71% growth in Klarna US consumers to 25m in January 2022.

Sebastian Siemiatkowski, CEO and Co-Founder of Klarna said: “We are now serving more than 100m active customers across the world, and our free short-term credit products have become an expression: BNPL. I am pleased to say that 99% of our lending globally is repaid. But we have also continued to grow our Pay Now immediate settlement option that today represents c40% of our total transaction volume. With some truly exciting companies like Stocard and Hero joining Klarna, our active consumer number will grow to over 147m. We have also massively accelerated our global expansion with the addition of 10 new markets since the start of 2020.

With our focus on creating products which consumers love powered by effective underwriting, our credit loss rates have reduced by over 30% since 20191. This is a major achievement, most importantly since behind that numerical reduction is the lives of tens of thousands of consumers where we have avoided adding to an unhealthy debt burden. The detailed reader will however notice that in absolute terms our credit losses are growing, not shrinking. This is entirely explained by Klarna’s growth, expansion to new markets and massive inflow of new customers. It is more challenging to underwrite a new customer compared to an existing returning one.”

You can watch Sebastian talking about Klarna’s 2021 financial results here.

The Klarna app is now the single largest driver of GMV across the Klarna ecosystem, fuelling growth for Klarna and its retail partners through consumer acquisition and referrals. It is the second fastest-growing app2 on a downloads basis compared to major global payments peers. The US has the highest share of Klarna app users of any market and accounts for over 40% of global downloads, placing Klarna in the Top 10 US shopping apps3. In December, US downloads of the Klarna app outpaced PayPal, YouTube, Snapchat, Whatsapp and Twitter. The shop-anywhere online or in-store capability of the app drives loyalty with features consumers love, with app users purchasing about 3x more often than non-app shoppers.

Klarna is a growth partner for retailers, not a marketplace. We support retailers through the entire sales funnel from consumer acquisition to shopping to post-purchase experience. In 2021 we expanded the ways retailers can use Klarna to connect with consumers through complementary acquisitions while diversifying revenue streams. Klarna initiated 301m clicks to retailers through our advertising services during the year, 2.6x more than in 2020, and 45 of the US Top 100 Retailers choose Klarna’s advertising services. Our compelling pre-purchase proposition for consumers now includes instantly shoppable content, live and virtual shopping, search and dynamic ad campaigns, in-app sponsored placements, and launching tailored content creation partnerships. New, enhanced services will come online during 2022 with rollout to many more retail partners. 

Klarna has seen accelerated demand across its in-store products as retailers look to drive the consistency of customer experience across channels through one preferred partner with 170% YoY rise in in-store merchandise volumes. Klarna is now live in c80,000 US stores as well as many more globally, including H&M in 11 countries. 2021 also saw the launch of Klarna’s partnerships with three of the top US mall operators meaning Klarna is now in an optimal position for in-store shopping at over 300 major shopping destinations across the US.

Klarna’s rewards program, which now has 4m members in the US and Australia and is driving a 3x uplift in repeat purchases in the US, and is now being rolled out to the UK, DACH, Nordics and all growth markets. The fastest-growing customer segments by volume generated4 in both mature and growth markets are those who purchase through Klarna more than twice a month.

Through our ambitious 2021 product expansion including the launch of the shopping app simultaneously to 18 markets, we are creating more opportunities for consumers to engage with our retail partners through Klarna, attracting new consumers while growing loyalty among existing users. In growth markets, products that can be used across channels are supporting consumer acquisition and ongoing loyalty including the app and shop-anywhere browser extension. 

Consumers should first and foremost pay with money they have. Period. This is why we are continuing to expand our Pay Now option, which we are especially proud to launch it in the UK. Less known is that Klarna owns the world's largest account-to-account-based payments infrastructure, through our acquisition of Sofort back in 2014. This allows us to create a truly unique and cost-efficient alternative to the existing payments network. Again we are happy to see that c40% of our transaction volume is Pay Now and we expect that share in physical stores to come closer to 90%. 

The Klarna Card has been particularly successful in meeting consumer demand for fair and transparent alternatives to conventional card offerings. Over 800k consumers across Sweden, Germany and the UK, up 50% YoY, now take advantage of the card’s flexibility with clear payment schedules, no interest, and no fx mark up with the US launch waitlist reaching 500k within 5 days. Klarna’s new in-app savings account in Germany, Festgeld+, means consumers now trust Klarna with over EUR 6bn of their money across Klarna’s savings accounts. Festgeld+ already has EUR 100m of deposits less than one month after launch, illustrating consumer demand for banking products that better serve their needs.

You can find the CEO letter to shareholders and full report here


Contacts details:

For additional information, please contact:

Candice Macdonald press@klarna.com  +44 7803 433557

About Klarna

Since 2005 Klarna has been on a mission to revolutionize the retail banking industry. With over 147 million global active users and 2 million transactions per day, Klarna is meeting the changing demands of consumers by saving them time and money while helping them be informed and in control of their personal finances. Over 400,000 global retail partners, including H&M, Saks, Sephora, Macys, IKEA, Expedia Group, and Nike have integrated Klarna's innovative technology to deliver a seamless shopping experience online and in-store. With over 5,000 employees, Klarna is active in 45 markets and is one of the most highly-valued private fintechs globally, with a valuation of $45.6 billion. For more information, visit Klarna.com

Klarna has been backed by Sequoia Capital since 2010 and more recently, SoftBank, Dragoneer, Bestseller Group, Permira, Visa, Atomico, Ant Group and Silver Lake, HMI Capital, TCV, Commonwealth Bank of Australia, Chrysalis Investments Limited, funds and accounts managed by BlackRock, amongst others. 

1 Credit losses comparison between 2019 actuals and 2019 at 2021 loss rates, where the latter has been calculated applying, at country level, 2021 credit loss rates to 2019 merchandise volume.

2 Apptopia, 2021

3 AppAnnie, 2021

4 2019-2021