The Swedish online payment service Klarna allows customers not to pay for goods until they are delivered. To make a purchase, the consumer only needs to specify their email and mailing address.
In 2005, three students from Sweden created a system for paying for purchases in Klarna online stores. Today, 8 million people use the service in Sweden, Finland, Norway, Denmark, Germany, Austria and the Netherlands. Over seven years, 50 million transactions were conducted through the system. The company's turnover last year exceeded 1 billion Swedish crowns (approximately 160 million euros).
The main idea of Klarna is to make online shopping possible for everyone: for those who are afraid to leak their credit card information, and for those who do not want to pay in advance. The company assumes the risks of both parties: in any case, the seller receives money for the goods sent, and the buyers pay after they receive the purchase.
A seller connected to the service sends order information to the company. If the check is successful, Klarna transfers the money to the seller's account. When the consumers click on the "buy with Klarna" button on the store's website, they are redirected to a page where they only need to enter information about themselves. In different countries, the requested data is different. For example, in Sweden, buyers enter their social security number; in other countries - the email address. If they had already made purchases using the service, the rest of the forms would be filled in automatically.
Klarna account allows you to make purchases in different stores and pay for the services online, including many online casinos and online bookmakers.
Although Klarna knows so little about their customers, they practically do not face fraud on their part. To protect its business from dishonest customers, the company has developed its algorithm for detecting fraud based on information about millions of purchases made. Purchase permission is issued to a customer in less than a second. If the email address seems suspicious, then the algorithm will request more information about the client.
Merchants can install ready-made Klarna modules on their website for free. The company claims that its trading partners recorded a 30 % increase in sales. In the next two years, the service plans to enter the US market.