Klarna has introduced a new cashback program for its 12 million customers in the UK. Klarna, known for its buy now, pay later service, now offers customers the opportunity to earn up to 10% cashback on purchases made through the Klarna app.
Participating retailers in the cashback initiative include Boots, Expedia, Dyson, Samsung, and Hotels.com, with more to be added over time. Customers can utilize the cashback within the Klarna app to reduce their balance, withdraw as cash, or apply it towards future purchases anywhere Klarna is accepted.
There is no limit to the amount of cashback customers can earn, but if an account remains inactive for 90 days, the cashback may expire. However, members of the paid Klarna membership program enjoy cashback without any expiration.
David Sandström, Klarna’s chief marketing officer, expressed that the cashback feature is part of the company’s commitment to enhancing the shopping experience by providing tangible benefits to consumers during the busiest shopping season.
Klarna’s payment options like “Pay in 30 days” and “Pay in 3” come with interest-free repayments. Late payments might incur a £5 fee on orders above £30 or 25% of the purchase price for orders under £20. Additionally, missed payments could impact credit reports if shared with credit agencies.
In response to concerns raised by the Financial Conduct Authority (FCA) regarding buy now, pay later schemes, new regulations are being proposed to ensure affordability checks are conducted and support is offered to individuals facing financial difficulties. Customers will have the option to seek assistance from the Financial Ombudsman Service in case of issues, with the new rules scheduled to be enforced under the FCA’s oversight in July 2026.
Businesses will have a six-month window from the enforcement date to seek full authorization under the new regulatory framework.