Personal Loans

Klarna Buy Now, Pay Later Review 2023

We review Klarna credit's fees, repayment terms, borrowing amounts, and credit requirements for online purchasing.
Written by:
Shannon Lee
Edited by:
Kristin Marino verified
Editor's Rating

Online shopping has become almost as common, if not even more so, than shopping in a brick-and-mortar store. Sometimes you need to shop in a physical location, such as to test out a computer you’re thinking about buying or see how that mattress really feels before you drop your hard-earned money on it. Still, even those things can be explored in a physical store and later purchased online, often for a cheaper price.

In most cases, you will pay for online purchases with a credit or debit card. Occasionally, a gift card will be your go-to method. But what if you aren’t comfortable putting the purchase on your credit card or the funds in your bank account are a little thin?

Enter Klarna Buy Now, Pay Later, a point-of-sale financing option that is a good alternative to using your credit cards.

Klarna At-a-Glance

Klarna offers a point-of-purchase option to Buy Now, Pay Later, along with a few other options that might work for you. Here’s the basic rundown:

  • Make a purchase with Klarna and pay 25% up front, then spread the other payments out over four months.
  • There is no interest charged with the buy now, pay later plan.
  • If you want to do things a bit differently, you can opt for Pay in 30, which allows you to purchase the item but wait 30 days to pay, or the longer financing option, which works much like a personal loan.
  • Klarna works with your credit or debit card and requires no credit check (unless you go with longer financing).
  • Klarna doesn’t report to credit agencies, so it’s not a good way to build credit.

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Compare to Others

Klarna isn’t the only buy now, pay later option on the market. Here are a few others and how they stack up.


Afterpay works much the same way Klarna does but offers their interest-free option paid over the span of six weeks rather than four months. Late payments are capped to help you stay on track financially if you can’t make your payments on time. The company offers financial health tools for users and an easy contact interface.


Just like Afterpay, Sezzle allows for spreading out a payment over six weeks and paying no interest during that time. Sezzle offers the Sezzle Up option, which reports on-time payments to the credit bureaus and helps you build credit – that’s great for those who start out with little to no credit at all. Customer support is hard to come by, available only via email.


This is another option that allows you to spread out payments over six weeks. It’s more widely available than other apps right now because it is accepted by any place that uses the Visa network (which is virtually everywhere). A referral program allows you to earn money for sending a friend to Zip. A $6 fee is charged at the commencement of the payments and you are also charged interest, starting immediately – which might make this a more expensive option.

Consider a Personal Loan

If you need money for more than just shopping, consider a personal loan. Use the tool below to compare rates and more.

How Does Klarna Work?

Klarna is a point-of-sale financing option. That means that you can obtain the financing right there at the retail site (and in some cases, you can choose to use it at an in-person store, though that is rarer than the online options). You might consider using it when you don’t have enough cash in your bank account or you aren’t comfortable purchasing it with your available credit.

Klarna works by allowing you to make the purchase and choosing how to repay the funds in installments. Here’s an example: perhaps you want to purchase a $2,000 laptop. But you don’t like the idea of putting that much on credit or you simply don’t have enough in the bank to make it happen. In that case, using Klarna could allow you to make the purchase you need to make, while giving you the option of paying it back in installments – perhaps $500 a month for four months.

You can also opt for a “Try for 30 Days” option that allows you to make the purchase and not pay anything for 30 days. Then your payments begin as usual. If you need longer than four payments, you can opt for Klarna financing plans, which can range from six to 36 months.

You can see how this option could make your financial life much easier.

Who Is Klarna For?

Klarna works well for those who want to make a purchase but don’t have the immediate funding available to cover it.

Klarna is also good for those who don’t want to request a loan and suffer a hard hit to their credit. The Buy Now, Pay Later model allows for immediate purchasing power without interest fees or charges that break the bank. There are few bells and whistles to this option, which is the point: The payments are split into equal, easy-to-remember payments with no hidden surprises. Klarna is great for those who simply want a little more leverage to purchase what they need, when they need it.

Top Features of Klarna

Curious about what Klarna can do for you? These features are among those that users enjoy the most.

No Interest Charges

There are no interest charges when you use the four-installment plan with Klarna. If you want longer financing terms, which range anywhere from six to 36 months, you will be subject to interest rates that range from zero to 29.99%.

No Fees

There are no fees when you use Klarna – no set-up fee, no origination fee, and no interest charges. The only fee you might face is if the funds aren’t available in your account on the due date. In that case, Klarna will charge a late fee. However, with the option to extend your due date, this might never become an issue.

Rewards Club

Not only do you get the good opportunity of financing on your terms, you also get the Rewards Club benefits. You earn points for every dollar spent, which can then be used for perks from partners.

No Hit to Your Credit

When you choose the straightforward “Buy Now, Pay Later” option with four easy installments, there is only a soft credit check – this doesn’t affect your credit score at all.

Flexible Repayment Options

When it’s time to repay the funds to Klarna, you can do so by either linking your account to your credit card or your debit card. The debit card pulls directly from your bank account and so you don’t have to worry about interest; however, if you choose to use your credit card, remember that you might owe interest to the credit card issuer for any balance you carry over.

Due Date Reminders

Klarna reminds you of the due date of your payments a few days in advance, so you aren’t hit with a surprise payment you forgot about. This gives you the time to make sure the funds are in your account before the due date.

Potential for Longer Financing

If you need more than the four payments to handle the purchase, Klarna offers a long-term financing option. This ranges from six to 36 months and charges an APR of anywhere from zero to 29.99%. Keep in mind that this requires a hard credit check, which could affect your credit score.

How to Get Started

Getting started with Klarna is very simple. If you are shopping at a retailer that partners with Klarna, the “Buy Now, Pay Later” option will be clearly displayed at checkout. Once you choose this option, you will be sent to the Klarna website, where you fill out a brief application. You will choose how you want to pay the funds back – either via credit card or debit card.

Alternatively, you can start with the Klarna shopping app, navigate to the retailer you want to shop at, do your shopping, and pay at check out through the app. When you do this, you will receive a one-time virtual card for the amount you want. You then use that just as you would a credit card.

You must spend at least $10 to be eligible to use Klarna. You can expect the first payment, which is 25% of the total cost, to be deducted immediately from your credit card or bank account.

Rating the Features

Are you wary of using Klarna or other point-of-sale financing options? Understanding more about the features could help you overcome the reluctance. Here’s what to expect.

User Experience

Using Klarna is very easy. You can sign up right at the point of sale and there are no lengthy requirements to go through the process and get the funding you need. Once it’s all set up, you can make the purchase as you usually would. Klarna will then send you an email detailing what you will owe and when. Given how popular these point-of-sale transactions are, it’s safe to say that using Klarna is an overall good experience.


Klarna doesn’t charge any fees on the money you borrow. However, it’s important to note that when you make your purchase, you are charged the initial payment up-front. That payment will be 25% of the purchase price. So in our example of purchasing a $2,000 laptop, the first $500 of the cost will hit your bank account or credit card the moment you confirm the purchase.

Keep in mind that if your payment doesn’t go through as scheduled, Klarna will charge a late fee. (However, you do have the option to change your dud date if you worry that you won’t make the payment on time.)


There is no interest charged by Klarna for the “Buy Now, Pay Later” option, so there are no rates to worry about on their end. However, if you attach a credit card to your Klarna account and use that to pay for purchases, you will likely be charged interest on the balance if you carry it over from month to month.

If you choose to go with a longer agreement with Klarna, you can opt for anywhere from six to 36 months to pay off a purchase. This longer financing option does come with an interest rate of anywhere from zero to 29.99% APR depending upon your credit-worthiness and other factors.

Customer Support

Klarna offers numerous ways to get in touch with customer support, but the easiest route is the “Report a Problem” button on the Klarna app. Live chat is available 24/7 and you can also call the company to speak to a live person around the clock.


Klarna is available anywhere and is hosted on many retail websites. Simply clicking the “Buy Now, Pay Later” button will take you to Klarna. If a particular retailer hasn’t partnered with Klarna, you can still use it by going directly to the Klarna website and following the instructions to pay for your purchase. Unlike getting a loan, you don’t have to worry about having a low credit score or a high debt-to-income ratio; as long as you can pay your bills, you’re golden.

Pros and Cons of Klarna

Still not sure what the downsides are? Let's look at the pros and cons of using Klarna.

Alternatives to Klarna

If you aren’t comfortable with using Klarna, there are other options that can get you the financing you need for a large purchase.

Credit Cards

Putting a large purchase on a credit card makes sense if you can score an introductory APR of 0% for 12 months or more. But if you don’t have that introductory offer, you might wind up paying a good amount of interest as you pay off the bill over time.

Personal Loans

Getting a personal loan can take time and certainly doesn’t allow for point-of-purchase options like Klarna does. However, for a large purchase that you’ve had your eye on for a while, the time it takes to get a personal loan might be worth it to you.

You should compare both and decide which one makes more sense for your situation.


Though you might have a large amount saved up just for this purpose (and if you do, kudos!), most people don’t want to dip into their savings to make a purchase that isn’t for an emergency. This is especially true if your savings is invested in a way that accrues interest. Klarna offers the option of spreading out the payments so you might be able to handle it without touching your savings.

Frequently Asked Questions (FAQs)

Is Buy Now, Pay Later a scam? What’s the catch?

Buy Now, Pay Later options are great if they are from a reputable company. Look for places like Klarna to ensure that you are not getting into a scam. And remember, if it sounds too good to be true, it probably is.

What happens if I can’t pay my Klarna bill when it comes due?

Klarna will charge a late fee if they can’t withdraw the payment from your account. After the second attempt, they will pause your ability to use the service. If you go for several months without making your payments, you might have your account sent to a debt collection agency, which will likely have a negative effect on your credit score.

What if I change my mind about my purchase?

Klarna allows for easy refunds. Simply alert the to the problem or your change of heart, and they will pause the account until things are sorted out with the merchant.

My friend got $1,000 worth of credit but I only got $500. What gives?

Klarna offers lower limits for those who haven’t used the service before. Once you have used it a few times, you’ll see the limit you can use go up.

Bottom Line

Klarna is a buy now, pay later model that allows you to make large purchases even when money is tight. If you can commit to paying 25% of the purchase up front and the rest spread out over four months, Klarna might be right for you. You can download the app to use it at any retailer.