A Deal With Developer Brookfield Catapults Klarna Into U.S. Shopping Centers

The Sweden-based buy now, pay later provider Klarna AB on Friday announced a major move in its increasingly crucial U.S. market with the news that it will provide its payment service to Brookfield Properties, a real-estate developer with more than 150 shopping centers. The agreement, which makes Klarna the exclusive provider for New York City-based Brookfield, also further extends BNPL into in-person shopping as U.S. consumers return to stores.

The latest agreement comes on the heels of Klarna’s announcement earlier this month that it has opened a waiting list for its Klarna Card, a cobranded Visa card issued by Salt Lake City-based WebBank. And Klarna in November launched in the U.S. its Pay Now service, allowing users to pay in full using Klarna at checkout.

Klarna, which is accepted at 80,000 physical stores worldwide, is already live at the merchants H&M, Ralph Lauren, Sephora, and Abercrombie & Fitch, all of which are Brookfield tenants.

Brookfield says store traffic is returning to “historical norms” at its shopping centers, with the 2021 holiday-shopping season reaching 95% of the traffic numbers seen during the same time in 2019. This contrasts with the national average of 78%, according to information Brookfield and Klarna released Friday.

The new arrangement with Klarna is “a natural match for us,” said Katie Kurtz, senior vice president of business development for Brookfield, in a statement. “We look forward to offering Klarna’s services to our shopping-center communities.”

Klarna has been vague about when its Visa card will launch in the U.S. market, saying it will be available “in the very near future.” But Klarna is clearly aiming to capitalize on its fast-rising popularity in the U.S. It says its American customer base has reached 25 million, increasing 70% in the past year as consumers increasingly turn to the buy now, pay later alternative for shopping, particularly at online stores. The Klarna app alone accounts for 6 million monthly active users in the U.S., according to information released earlier this month.

Worldwide, Klarna claims more than 100 million active users performing 2 million daily transactions. Its service is available at some 250,000 retail companies across the globe.