Fintech & Ecommerce

Klarna Wins Regulatory Approval in UK

Klarna Bank AB in the United Kingdom has received permission from the local regulator, which provides an opportunity to offer lending services and financial products related to payments to consumers in this country.

Klarna Wins Regulatory Approval in UK

At the same time, in this case, an important nuance is that the mentioned company did not get permission from the authorities for Buy Now, Pay Later (BNPL) loans in the framework of the specified approval.

The decision taken by the Financial Conduct Authority (FCA) concerning Klarna Bank AB allows the firm to continue operating in the British financial services market. The previous temporary permit obtained by the company after Brexit expires in five weeks. Klarna, based in Stockholm, has set up a unit in the United Kingdom to offer its products to local consumers.

The company currently has a full European banking license. In recent years, Klarna has launched term loans and card products in the British financial services market that meet the requirements of FCA approval. Also in the United Kingdom, the firm offers payment transaction solutions to consumers. The company claims that in this country its BNPL products should be in the zone of official regulation.

Abby Vickers, head of Klarna Financial Services UK, says that the approval from the FCA puts the successful business of the firm on a sound regulatory framework. Separately, she announced the expectation of BNPL regulation in the United Kingdom.

In November, Klarna reported its first quarterly operating profit in four years, which was a kind of momentum for the company, which became the basis for initial public offerings of shares. The firm offers lending services to approximately 150 million consumers worldwide. These solutions are especially relevant for those who seek to reduce the cost of their purchases on virtual platforms.

On Thursday, November 23, the FCA published a message on its website stating that obtaining a permit for regulated lending means that this organization has evaluated the company’s approach to ensuring the availability of interest-bearing loans to consumers and that the firm offers the necessary forbearance to customers who have encountered financial difficulties.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.