This blog will explain the changes we are making to Klarna’s legal entity in the UK which is a requirement to continue offering regulated Financial Services in the UK following Brexit.
This change will allow us to continue empowering our UK consumers, offering a healthier and fairer way to access credit. We are moving our UK services to a new Klarna company, Klarna Financial Services UK Limited.
There will be no changes to the services we provide and the way we provide them. All that is changing is our services will be provided by the new UK-based legal entity, instead of Klarna Bank AB.
You’ll still enjoy all the products and services that you currently receive from Klarna and there is no action required from you.
In case you have any questions about this change, we have prepared an FAQ below.
Frequently Asked Questions.
Why have I received an email about a change to Klarna’s terms and conditions?
We wanted to let you know about some changes we are making to our terms and conditions. Even if you used Klarna a long time ago, you can still check the details of your payments and so we need to let you know about these changes.
Please note that this communication does not mean you have any outstanding payments; we just need to let you know about the change to our legal entity
What is changing?
We plan to move all of Klarna’s UK services to a new Klarna company called Klarna Financial Services UK Limited (KFSUK) on, or shortly after 5 December.
Why are you changing the company name?
Klarna services are currently provided by Klarna Bank AB. This is the Swedish company which provides services to customers in the UK and across the European Union. After the UK left the European Union (also known as Brexit), Klarna has been operating in the UK through the Financial Conduct Authority’s Temporary Permissions Regime, which allows EEA-based firms (like Klarna) to operate in the UK for a limited period while seeking full authorisation.
This Temporary Permissions Regime expires on 31 December 2023. Klarna has sought authorisation by the Financial Conduct Authority for our regulated credit and payment activities in the UK. This will allow us to continue to offer our regulated services, and as such, all services will now operate from the new company Klarna Financial Services UK Limited (subject to this company becoming authorised by the Financial Conduct Authority in the UK). Note that some of Klarna’s services in the UK, including Pay in 30 and Pay in 3, are not regulated by the Financial Conduct Authority.
How does this change impact me?
This will not change the services you receive from Klarna and you’ll still be able to enjoy all the services that you currently receive from Klarna. Your details, including purchase history, will not change.
For purchases made after 5 December, your relationship will be with Klarna Financial Services UK Limited. We will change our Terms and Conditions to reflect this, replacing Klarna Bank AB or Klarna Bank AB UK Branch with Klarna Financial Services UK Limited. The full list of legal agreements this change applies to is included at the bottom of this blog.
Klarna expects to receive Authorisation from the Financial Conduct Authority shortly, and for this entity to be directly authorised and regulated for the provision of payments and credit services. Some of Klarna’s services in the UK, including Pay in 30 and Pay in 3, are not regulated by the Financial Conduct Authority.
Any purchases which have yet to be fully repaid by 5 December will remain with Klarna Bank AB; any new purchases made after 5 December will be offered by Klarna Financial Services UK Limited. For new Direct Debit mandates created after 5 December, your relationship will be with Klarna Financial Services UK Limited. Any Direct Debit mandates created before 5 December will migrate from Klarna Bank AB to Klarna Financial Services UK Limited during December.
Will there be any changes to my data privacy rights, and how my information is protected?
No, there will be no changes to your rights under data privacy law, and because UK and EU privacy laws are very similar your information will continue to be protected to the same high standards. However, there are some changes regarding the registration of Klarna Financial Services UK Limited as a Data Controller with the UK Information Commissioner’s Office ‘ICO,’ which means that Klarna Financial Services UK Limited will fall under its supervision on privacy matters.
When will this change happen?
We are planning for this change to happen for most products on 5 December. However, this is subject to Klarna Financial Services UK Limited becoming fully authorised by the Financial Conduct Authority in the UK.
How does this change affect my Klarna services?
Klarna products and services in the UK will be provided by Klarna Financial Services UK Limited from the transfer date. This will mean that any Klarna services you may use, like Pay in 30 days, Pay in 3 installments or Klarna Financing loans will all be offered by Klarna Financial Services UK Limited.
This will happen without you needing to take any action. There will be no change to the way that you access our existing services via the Klarna app or our customer services team.
What do I need to do to accept this change?
You don’t need to do anything. In most cases, by simply continuing to use our products after 5 December you agree to be bound by these changes.
For certain products, like our Financing Account and Term Loans products, we will contact you separately to give you formal notice of your account being transferred to Klarna Financial Services UK Limited.
How will Klarna handle complaints, buyers protection claims or other disputes that are ongoing or relate to before the transfer date?
Klarna will continue to handle any outstanding queries or complaints that are already in progress after the transfer date – you will not be expected to submit your query again. You will also be able to contact our customer service team in relation to any purchase made before the transfer date and have the same options as you do now to raise a dispute or any other concerns.
What if I need more help?
Our customer service team is here to help. Please do get in touch if you have further questions or specific needs.
If you are experiencing financial hardship or difficulties with payments, we have specially trained experts on hand 24/7 to help you. For more information please start a chat in our app or call our support team.
Alternatively, here are a number of recommended not-for-profit organisations that can offer free, confidential and impartial advice:
- Money Debt Advice Locator – for guidance on where to get free and immediate debt advice across the UK. Worried about debts or have missed payments? There is free, confidential, and independent debt advice available. Money Helper website, run by the UK Government’s Money and Pension Service, can direct you to a debt adviser straight away by telephone or you can get support online, and also offers free, impartial advice on managing your money, dealing with debt and avoiding financial scams.
- Citizens Advice – For free and impartial consumer advice on debt and other topics, visit your local Citizens Advice or visit the website. By selecting your UK country on the homepage, you will get tailored contact information.
- AdviceUK – Member centres offer debt advice, including specialist advice for minority communities and people with disabilities. While the website is predominantly for the centres themselves, through their member portal you can search for support in your area, related to your specific needs and concerns.
- Christians Against Poverty – Select the link and search your postcode for free debt advice near you and then call 0800 328 0006 for further support.
- National Debtline – For free guides, factsheets, tools and debt advice in England, Wales or Scotland, select the link or call 0808 808 4000.
- StepChange Debt Charity – For debt advice throughout the UK select the link or call 0800 138 1111.
I do not want to move to Klarna Financial Services UK Limited, what are my options?
Unfortunately, as the Temporary Permissions Regime expires on 31 December 2023, Klarna Bank AB is unable to carry on providing regulated services in the United Kingdom using its existing structure after this date.
This change will not impact the nature or quality of the products and services you receive from us. All that is changing is your services will be provided by Klarna Financial Services UK Limited, under the direct supervision of the UK’s Financial Conduct Authority (pending authorisation).
Which legal arrangements do these changes apply to?
Subject to Klarna Financial Services UK Limited becoming authorised by the FCA to carry out consumer credit activities and regulated payment services in the UK, we will make changes to the Klarna legal arrangements for all UK users with effect from 5 December 2023 or a later date as the case may be.
The following agreements and notices identify either Klarna Bank AB or Klarna Bank AB UK branch as the provider of Klarna services in the UK. These will all be updated to instead identify Klarna Financial Services UK Limited as the new provider of Klarna services to UK consumers.
- Klarna Shopping Service
- Pay Now by Card
- Pay Later in 30 days
- Pay in 3 installments
- Klarna Card
- One-time card
- In-store card
- In-store card in your digital wallet
- Open banking
- Import service
- Privacy notice
- Privacy notice open banking
- Tracking technology notices
- Direct debit mandate
- Marketing consent
Who should I contact if I have more questions?
If you have any further questions, please don’t hesitate to get in touch with our customer service team who are available 24/7 via a chat in our app, or via phone Mon – Sat 9 am–6 pm (excluding public holidays).