Klarna has introduced a new cashback initiative for its 12 million customers in the United Kingdom. The popular buy now, pay later service now offers a cashback feature that enables users to receive up to 10% back on their online purchases when using the Klarna app for shopping.
Participating retailers in this cashback program include Boots, Expedia, Dyson, Samsung, and Hotels.com, with more to be added in the future. The cashback amount can be utilized within the Klarna app, applied to the Klarna balance, withdrawn, or saved for future purchases wherever Klarna is accepted.
Customers have the opportunity to earn unlimited cashback; however, if the account remains inactive for 90 days, the cashback may expire. An exception to this rule applies to members of the paid Klarna membership scheme who enjoy cashback benefits without an expiry date.
David Sandström, Klarna’s chief marketing officer, emphasized the value of the cashback feature, stating, “Cashback is another way we’re delivering on our promise to make every purchase smarter, providing real value to consumers as the busiest shopping season approaches.”
In addition to the cashback program, Klarna offers interest-free repayment options on most payment plans, such as “Pay in 30 days” and “Pay in 3.” Late payments may incur a fee of £5 for orders over £30 or 25% of the purchase price for orders under £20. Moreover, missed payments can impact one’s credit report if shared with credit referencing agencies.
The Financial Conduct Authority (FCA) has initiated a consultation on buy now, pay later services due to concerns about customers accumulating unmanageable debt. Proposed regulations aim to ensure affordability checks, financial support for customers in difficulty, and the ability to file complaints with the Financial Ombudsman Service. These rules are expected to be enforced under the FCA’s authority starting in July 2026, providing firms with a six-month window to seek full authorization.