Klarna has secured a $26 billion funding boost through a strategic agreement with Nelnet, enabling further expansion in the U.S. market. This development is significant as it strengthens Klarna’s ability to enhance its “Pay in 4” installment program. The collaboration is expected to provide Klarna with the necessary capital to cater to the growing consumer demand for flexible payment options, particularly in the U.S. where its services have been gaining traction. Such a large influx of funds reflects Klarna’s confidence in the growth potential of the “Pay in 4” program and its commitment to delivering a seamless shopping experience to American consumers.
Earlier reports indicated Klarna’s consistent efforts to dominate the buy now, pay later (BNPL) sector. A 2025 PYMNTS Intelligence study revealed a rising consumer reliance on BNPL services, with Klarna leading the market. Klarna’s adaptive approach and focus on scalability have helped the company maintain its competitive edge, allowing it to capture a larger market share compared to peers like Afterpay and Affirm.
Klarna’s Strategic Move with Nelnet
Klarna has opted to partner with Nelnet to offload up to $26 billion in receivables tied to its “Pay in 4” arrangement. As part of this strategy, Klarna will continue to originate and service all related receivables, ensuring uninterrupted service for both consumers and retail partners. The company’s CFO, Niclas Neglén, noted that the transaction represents a crucial step forward, bolstering Klarna’s capabilities to execute significant capital market operations.
“This is a landmark transaction for Klarna in the U.S.”
How is Klarna Performing Financially?
Klarna’s financial performance in the second quarter highlights its growing influence. Revenue grew by 20% year-over-year, with significant contributions from an expanding merchant network in the U.S., where revenues surged by 38%. The introduction of the new Klarna Card pilot and partnerships with retailers like Walmart and eBay have further cemented Klarna’s foothold in the American market.
The key driver for Klarna’s growth appears to be its ability to cater to shifting consumer preferences. Many consumers are increasingly opting for BNPL services, with some willing to forego purchases if such options are unavailable. Klarna’s research found that over a third of customers would adjust their spending accordingly, underscoring the strong market demand for these services.
These strategic developments align with recent research that highlights Klarna’s dominance in the BNPL sector. Holding a market share of 26.2%, Klarna leads the American BNPL landscape, followed closely by Afterpay and Affirm. This achievement emphasizes Klarna’s commitment to delivering value-driven financial solutions.
Nelnet’s collaboration allows Klarna to secure the necessary resources for additional growth without compromising service quality. Klarna is preparing for new collaborations with partners like Worldpay, Nexi, and JPMorgan Payments, reflecting a broader focus on enhancing payment services for retailers and consumers alike.
Klarna’s current strategies involve leveraging new funding to scale its operations more efficiently and sustain a robust service model for its users.
“Our partnership with Nelnet allows us to scale a core product responsibly.”
This approach ensures that Klarna can expand responsibly while maintaining quality and user experience.
Klarna’s recent funding marks a strategic leap in its bid to strengthen its position in the highly competitive BNPL market. Such initiatives facilitate consumer adoption of BNPL services while providing Klarna with a sustainable growth trajectory. As the U.S. remains a focal point for the company’s growth ambitions, its long-term success will likely depend on balancing financing leverage with operational scalability and consumer satisfaction. Klarna’s commitment to exploring collaborative fintech ventures and expanding its BNPL offerings could further solidify its market leadership.
