Following approval from the Financial Conduct Authority (FCA), Klarna’s UK subsidiary, known as Klarna Financial Services UK (KFSUK), has been granted the status of an Electronic Money Institution (EMI).

New Products and Features

The new EMI license will enable Klarna to introduce products such as Klarna balance and cashback to its customer base, which includes over 11 million users in the UK. These features have already been launched in other markets like the United States and several European countries.

Enhanced Fund Management

Klarna balance will allow UK customers to store and manage funds within their Klarna accounts. Users can add money via a debit card, use it for purchases through the platform, and receive refunds directly into their balance. Additionally, Klarna is introducing a cashback program, which provides up to 10% back on purchases made using its app. This reward will be credited straight to the user’s Klarna balance without relying on points or other incentives.

A spokesperson from Klarna stated that this authorization is part of their broader strategy in the UK to move beyond flexible payment solutions and offer more general personal finance tools. They believe this expansion reflects a change in how customers manage daily spending and rewards.

The EMI license will facilitate further product development for Klarna. The company aims to expand its range of services, moving from just payments to becoming a comprehensive financial services provider within the retail banking sector.