With Its Newest Banking License, Klarna Now Eyes P2P Payments Space

Klarna, Swedish payments firm, is looking into the person to person payments space, as the company secured a banking license earlier today, Bank Innovation has learned.

Klarna has been granted a full banking license by the Swedish Financial Supervisory Authority, according to a company announcement. The move instantly turned Klarna into one of “Europe’s largest banks with 60 million customers, 70,000 merchants, and working seamlessly across borders,” according to CEO Sebastian Siemiatkowski.

With the new license, the payments company plans to broaden its product portfolio for customers and merchants. “[There are] many opportunities, including the issuing of cards and direct integration into banking and payments infrastructure,” Aoife Houlihan, VP of communications at Klarna, told Bank Innovation. “This allows us to broaden and enhance product offering in a really interesting way,” including P2P payments, she added.

With a 60 million existing customer-base, the company seems well-positioned to offer its own version of Venmo, and compete with European social payments leaders, such as Transferwise or Circle (which introduced blockchain-powered cross-border payments last week).

The feature will be launched in less than a year, Houlihan added, but no further information was available at the time of this reporting.

As part of the banking license deal, the company — which reportedly has $2.25 billion in valuation and $80 million in funding — plans to change its name to Klarna Bank. With SoFi as another recent bank-convert, some industry experts expect this trend to takeoff further.

a tech co. w/a bank license is a big deal. expect more #fintech startups to chose this. @Chris_Skinner @davidbrear https://t.co/wegIHOQhvR pic.twitter.com/F23tvYnBq6

— pascalb👁️uvier ≠🪼 (@pascalbouvier) June 19, 2017