A nearly ten-year old acquisition may turn out to be Klarna’s secret weapon to improve security during the checkout process.
The Swedish payments company announced this week that it has integrated a new payment service into its Klarna Pay Now product suite. The integration is designed to improve checkout security and has been made possible thanks in large part to Klarna’s acquisition of Germany-based Sofort in 2014.
“We are integrating Sofortüberweisung into the Klarna environment to offer consumers and merchants the best of both worlds: the familiar Sofort payment process combined with the smoother, more secure payment experience and global reach of Klarna,” Klarna Chief Commercial Officer David Sykes said. “The combined product is better for merchants and consumers, and (is) also a platform for Klarna to expand the functionality of Sofortüberweisung globally.”
Sofortüberweisung is a bank-to-bank payment service that Klarna gained access to by acquiring Sofort GmbH in 2014. Klarna has been incorporating Sofort’s technology into its solutions since 2017, and has launched the service in some of its other markets around the world, including the U.K. With this week’s integration, consumers will be able to track their Sofortüberweisung payments from within the Klarna app, as well as make payments without having to re-enter their payment information. This, combined with Klarna’s two-factor authentication, facilitates both greater convenience and increased security.
To that point, customers will need a Klarna account in order to take advantage of the Sofortüberweisung integration, and the company notes 95% of Sofort customers already have one. Klarna also reports that the “improved user-friendliness” of the integration has produced a 5% increase in conversion rates for consumers who use it.
Founded in 2005, Klarna made its Finovate debut at FinovateSpring 2012. In the decade-plus since then, the company has grown into a major e-commerce and payments business with 150 million total active customers in its network – including 34 million in the U.S. With more than 500,000 total merchants using its technology, Klarna facilitates two million transactions per day.
The company also recently made headlines with word that it is preparing for an initial public offering in the U.S. as early as the first half of 2025. Also this month, Klarna announced that it had partnered with Adobe Commerce to make it easier for merchants on the platform to implement Klarna’s Buy Now Pay Later (BNPL) services.
“Consumers are embracing the flexibility that Buy Now Pay Later services can provide, with Adobe Analytics data showing over 11 percent growth this year,” Jason Knell, Adobe Sr. Director, Content & Commerce Partners, said. “Klarna’s global footprint enables Adobe Commerce merchants to meet the changing needs of their customers and stay competitive in today’s digital economy.”
Klarna is headquartered in Stockholm, Sweden. Sebastian Siemiakowski is Klarna’s CEO.
Photo by Karolina Kaboompics
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