Klarna granted UK EMI licence, as looks to position itself as "global digital bank"

Klarna has been granted a licence in the UK, which will allow it to launch a debit card and offer savings accounts to its 11m UK customers as it looks to compete against UK challenger and established banks by offering some banking services.

Klarna’s UK subsidiary has been granted an Electronic Money Institution (EMI) licence by the UK regulator, the Financial Conduct Authority.

The authorisation will allow Klarna to offer some banking services in the UK, but stops short of allowing it to offer a full suite of banking services such as lending, which it would be able to offer under a banking licence.

Klarna said it had nothing to share, when asked if it planned to apply for a UK banking licence.

Klarna, which is most well-known for its BNPL offering, is looking to position itself as a “global digital bank”.

The EMI licence authorisation will mean that Klarna can launch its debit card in the UK, which it is piloting in the US, and UK customers will be able to hold and manage funds in their Klarna accounts.

In Europe, Klarna already has a banking licence which is overseen by Swedish regulators.

Abby Vickers, Head of Klarna Financial Services UK, said:” This authorisation marks Klarna’s next big step in the UK—moving beyond flexible payments into everyday financial management.

"While traditional banks are still playing catch-up, Klarna is giving consumers a smarter way to spend—and now, to manage their finances too. This is what modern money management looks like: manage, spend, and get rewarded—without the hassle."

In May this year, Klarna reported its revenues were up 13 per cent year-on-year to $701m in Q1, but losses more than doubled to $99m at the BNPL fintech.