Klarna, DoorDash bring BNPL to the front door

In case you're still wondering whether buy now pay later (BNPL) has feet, the answer is yes, and it's racing to capture significant market share in the payments space. Stockholm-based Klarna just sealed a deal with DoorDash.

The DoorDash platform was built to support food delivery, but it has since branched out to deliver a variety of products customers order online or via mobile app.

Once the deal is finalized, "in the coming months," consumers can order groceries, retail items or a late-night snack even if don't have the funds to pay for it right then and there, Klarna stated. When customers reach the checkout they'll see Klarna as an additional payment option to pay in full. They can also choose to pay in four equal interest-free installments, or a pay later option, deferring payment to a more convenient time, like payday.

"As we expand DoorDash's offerings – from groceries and beauty to electronics and gifts – flexible payment options are essential to meeting customers' needs," said Anand Subbarayan, head of money products at DoorDash.

"Our partnership with DoorDash marks an important milestone in Klarna's expansion into everyday spending categories," said David Sykes, chief commercial officer at Klarna. "By offering smarter, more flexible payment solutions for groceries, takeout and retail essentials, we're making convenience even more accessible for Americans."

IPO and Walmart

The DoorDash collaboration with Klarna comes on the heels of news that Klarna had struck a deal with Walmart to be the exclusive provider of BNPL at the megaretailer, replacing rival company Affirm.

Klarna is teaming up with OnePay, a fintech backed by Walmart and the venture capital firm Ribbit Capital, on the project. OnePay is already integrated with Walmart's digital and physical channels, offering financial services to millions of Walmart shoppers and its 1.6 million associates, according to a press release.

Walmart customers will be given the option to pay off Klarna balances from a range of terms, from three months to 36 months. Sebastian Siemiatkowski, co-founder and CEO of Klarna, described the Walmart partnership as "a game changer."

Meanwhile, Klarna filed paperwork with the Securities and Exchange Commission for an initial public offering. It said it plans to go public on the New York Stock Exchange under the ticker symbol KLAR.

Klarna appears to be trying to rebuild following a significant downturn after riding high during the COVID pandemic. At the height of the pandemic it was valued at $46 billion, but in 2022 Klarna saw its value plummet by 85 percent. It has since rebounded, with analysts estimating its valuation in the $15 billion range,

Klarna's revenue last year was $181 million, a dramatic swing from its $49 million loss in 2023 Founded in 2005, Klarna has operated as a fully licensed bank in Europe since 2017, according to reporting by CNBC.

In addition to Affirm, which went public in 2021, Klarna competes with Afterpay, which was acquired in 2022 by Block, the parent of Square.

Klarna reported prior to the Walmart deal that it counted 93 million active customers and 675,000 merchants.

Whether you want to upgrade your POS offerings, find a payment gateway partner, bone up on fintech regs or PCI requirements, find an upcoming trade show, read about faster payments, or discover the latest innovations in merchant acquiring, The Green Sheet is the resource for you. Since 1983, we've helped empower and connect payments professionals, starting with the merchant level salespeople who bring tailored payment acceptance and digital commerce tools, along with a host of other business services to merchants across the globe. The Green Sheet Inc. is also a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals.

Notice to readers: These are archived articles. Contact information, links and other details may be out of date. We regret any inconvenience.