Afterpay rival Klarna is launching in Australia with a partnership with Commonwealth Bank, which is investing another $US200 million ($A296.5m) in the Swedish buy now, pay later company.
Commonwealth Bank said its app will integrate with Klarna, letting CBA’s 7 million digitally active customers quickly register for Klarna and see the items they’ve purchased, although non-CBA customers can also use Klarna.
Klara said its app will enable consumers to shop and pay with Klarna at online retailers and split the payments into four equal installations.
Over 205,000 merchants accept Klarna, which has over 85 million total consumers and 12 million global app users.
CBA and Klarna will jointly fund and have 50:50 ownership rights to Klarna’s Australian and New Zealand business.
Commonwealth Bank invested $US100 million ($A148m) in Klarna last year, and the new investment brings its stake in the Stockholm-based company to 5.5 per cent.
“Our partnership with Klarna will further enhance the customer experience in our leading banking app and address the rapidly growing demand among consumers for new payment options,” CBA chief executive Matt Comyn said.
“In particular, it allows us to build on our leading technology to deliver the very best payment services for our customers and merchants in Australia, on platforms which are safe, secure, and easy to use.”
Klarna’s other investors include Sequioa, Visa and Snoop Dogg, the rapper.
Zip Co senior executive Francine (Fran) Ereira has been appointed Klarna’s general manager for Australia and New Zealand, and the Swedish fintech has set up a Sydney office within the Work Club’s shared office space at 99 Elizabeth Street.