Following its recent initial public offering, Klarna has made a significant announcement that it will exclusively offer installment loans for purchases at Walmart in the United States, effectively replacing its rival Affirm. This move is facilitated through OnePay, a startup in which Klarna holds a majority stake, backed by Ribbit Capital. As disclosed in a statement, Klarna is expected to assume the loan offerings by the end of this year. This strategic partnership is set to revolutionize the shopping experience for millions of Walmart customers across the U.S., providing them with a smarter way to buy through installment loans powered by Klarna.
Notably, OnePay is already integrated into Walmart’s physical and digital channels, offering financial services to the retailer’s millions of customers and 1.6 million employees in the U.S., as well as being available to consumers worldwide. This integration underscores the potential for widespread adoption and the significant impact it could have on consumer purchasing habits. As Sebastian Siemiatkowski, co-founder and CEO of Klarna, emphasized, “This is revolutionary. Millions of people in the U.S. shop at Walmart daily, and now they can buy smarter with OnePay’s installment loans, powered by Klarna. The fact that OnePay has chosen Klarna as its exclusive partner for installment loans in Walmart is a huge vote of confidence in our mission to be everywhere for everyone. We look forward to helping redefine the payment process at the world’s largest retailer, both online and in physical stores.”
Walmart U.S. customers will have the ability to use Klarna’s OnePay installment loans to purchase a wide range of items, including electronics, home and garden products, and automobiles, among others. Upon approval, customers can choose from various payment terms ranging from 3 to 36 months and manage their loan through the OnePay app. This flexibility and convenience are expected to enhance the overall shopping experience, making it more accessible and appealing to a broader customer base. Omer Ismail, CEO of OnePay, noted, “It’s never been more important to offer consumers simple and convenient ways to access fair credit at the point of sale, and this is especially true for the millions of people who shop at Walmart every week for everything.”
The news of this partnership had a noticeable impact on the market, with Affirm’s stock prices experiencing a decline. The announcement led to an 8% drop in Affirm’s shares early in the afternoon, with the stock trading at just over $46. This reaction is understandable given the competitive nature of the fintech industry, particularly between Klarna and Affirm, which have been rivals for years. While Affirm is more focused on the U.S. market and went public in 2021, reporting $80 million in net revenue, Klarna has seen a recovery, posting a net profit of $21 million in 2024, a significant turnaround from its $244 million loss in 2023.
In a recent interview with PaymentsDive, Max Levchin, CEO and co-founder of Affirm, expressed his desire to differentiate his company from competitors, including Klarna. Levchin suggested that focusing on revenue from individual transactions, rather than marketing, is a key strategy. However, a Klarna spokesperson countered this claim, stating that the majority of Klarna’s revenue comes from transactions, with a smaller portion from marketing. Levchin further emphasized Affirm’s commitment to ensuring that each transaction makes financial sense, without relying on advertising or marketing for monetization.
The partnership between Klarna and OnePay to offer exclusive installment loans at Walmart marks a significant shift in the fintech landscape, reflecting the evolving needs of consumers and retailers alike. As the financial services industry continues to adapt to changing consumer behaviors and technological advancements, collaborations like this one are poised to play a crucial role in shaping the future of retail and financial transactions. With its sights set on redefining the payment process, Klarna’s move into the U.S. market through its partnership with OnePay and Walmart is a strategic step towards achieving its goal of being available everywhere for everyone.