Klarna seeks U.S. banking licence for Utah industrial bank

Klarna has applied for a U.S. banking licence to establish a proposed industrial bank in Utah.

It has submitted applications to the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation to establish Klarna Bank USA, which, if approved, would be a wholly owned subsidiary of Klarna Inc.

The move would expand Klarna's regulated banking footprint in the United States, where it currently serves customers through partner banks. The Swedish fintech has held a banking licence in Europe since 2017.

Klarna says 30 million Americans use its services each year, and that hundreds of thousands of merchants in the country rely on its products. Since 2019, it says it has provided U.S. consumers with access to more than USD $91.3 billion in credit and saved them more than USD $5.1 billion in interest compared with revolving credit card debt.

If regulators approve the application, Klarna Bank USA would be chartered in Utah and insured by the FDIC, with its own independent board, governance structure and internal controls.

The proposed charter would allow Klarna to bring existing U.S. banking operations in-house across payments, savings, credit and merchant services, supporting its longer-term expansion in the market.

U.S. push

The application signals a deeper commitment to the U.S., one of Klarna's most important markets, as competition intensifies in consumer finance and digital payments. A banking licence would also give the company a more direct route into deposit-taking and lending infrastructure, subject to regulatory approval.

Industrial banks occupy a distinct niche in the U.S. financial system. These state-chartered institutions can offer banking services under a framework that has attracted interest from commercial and technology groups seeking tighter control of their financial operations.

Klarna says the proposed bank would combine digital tools with traditional banking products, focusing on transparency and no hidden fees. It has cast the licence application as part of a broader effort to bring more of its U.S. financial activity under its own regulated structure.

Fintech executives have increasingly weighed whether to seek U.S. banking licences as they look to reduce reliance on third-party banking partners, tighten operational control and diversify revenue streams. The process, however, can be lengthy and subject to detailed scrutiny from state and federal regulators.

Sebastian Siemiatkowski, Co-founder and Chief Executive Officer of Klarna, linked the application to customer demand for a different approach to consumer banking.

"Banking is built on trust," said Sebastian Siemiatkowski, Co-founder and Chief Executive Officer of Klarna. "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, giving customers tools to borrow responsibly and build financial confidence, while bringing greater competition, innovation, and choice to consumers and merchants alike."

Leadership choice

Klarna has selected Gary Harding to serve as President and Chief Executive Officer of Klarna Bank USA. It says Harding has spent more than a decade in C-suite roles in the U.S. financial sector.

His previous roles include Chairman and Chief Executive Officer of Milestone Bank and President and Chief Executive Officer of Prime Alliance Bank. That background suggests Klarna is pairing its fintech model with executives experienced in running regulated U.S. banks.

Klarna says it will work closely with regulators during the application process. Approval will still depend on reviews by both Utah authorities and the FDIC.

Klarna is already a large payments and shopping network beyond this banking application. It says it has 119 million active users globally and handles 3.4 million transactions a day, with more than one million retailers using its services.

Its merchant roster includes large consumer brands and platforms such as Uber, H&M, Saks, Sephora, Macy's, Ikea, Expedia Group, Nike and Airbnb. Those relationships have helped the company build a broad presence across online and in-store payments, including through Apple Pay and Google Pay.

In the U.S., the banking application shows how Klarna is trying to move from being chiefly a payments and short-term credit provider to becoming a more directly regulated consumer finance institution. Whether regulators agree will determine how far and how fast that shift can proceed.