Klarna, the buy now, pay later fintech giant, is pivoting toward full-scale banking. The Swedish company announced plans to establish a U.S.-based subsidiary, Klarna Bank USA, which would operate as an FDIC-insured institution based in Utah.
If regulators approve the application, the new entity would be led by Gary Harding, former CEO of Milestone Bank and Prime Alliance Bank. CEO Sebastian Siemiatkowski framed the move as a trust-building effort, stating in the announcement: “Banking is built on trust. We’ve seen firsthand the appetite for a fairer, more transparent approach in the U.S., and our own banking license is the natural next step.”
Klarna currently processes over three million transactions daily and has more than 119 million global active users. Major retail partners include H&M, Saks, Sephora, Macy's, Ikea, Expedia Group, Nike, Uber, and Airbnb. The firm already operates as a fully licensed bank in Europe, offering broader lending and banking products than its U.S. installment-lending service.
The move signals a broader trend of BNPL platforms seeking regulatory legitimacy as consumer finance models face increased scrutiny from watchdogs. A banking license could give Klarna direct access to the U.S. payments infrastructure and allow it to offer savings accounts, loans, and deposit products — challenging traditional banks on their own turf.
Siemiatkowski argued that a licensed bank would help users “borrow responsibly” and build financial confidence. Yet critics warn that blending consumer lending with deposit-taking introduces new risks, particularly if the firm's underwriting models falter during an economic downturn. The application's approval is far from guaranteed, and regulatory hurdles could delay the subsidiary's launch for years.