What is Klarna Purchase Power and How Does It Work?

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Klarna is a popular payment service provider that enables customers to pay for their purchases in installments. The Swedish-based company has gained popularity in recent years, particularly among online shoppers who are looking for an alternative to traditional payment methods. One of the unique features of Klarna is its Purchase Power service, which allows customers to finance their purchases without incurring any interest or fees. The demand for purchasing affordably has been recently making more and more e-commerce businesses implement them in their purchasing processes (especially since some e-commerce accounting software allows for easily recording and managing payments of this type).

In this article, we will explore Klarna Purchase Power in more detail, including what it is, how it works, its advantages and disadvantages, and alternatives to consider.

What is Klarna Purchase Power?

Klarna Purchase Power is a financing service that allows customers to buy now and pay later for their purchases. Customers who use Klarna Purchase Power can split their payments into four equal installments, with no interest or fees. The service is available for purchases made on participating merchants’ websites and is subject to eligibility criteria.

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How does Klarna Purchase Power Work?

It’s pretty easy to start using Klarna Purchase Power, however you might need to fulfill several steps that include verifying your eligibility, application, waiting for approval and getting the payment schedule. Let’s look at these steps in more detail.

  • Eligibility

To use Klarna Purchase Power, customers must be at least 18 years old, have a valid email address and mobile phone number, and a valid payment method. Additionally, customers must have a billing and shipping address in the United States.

  • Application Process

The application process for Klarna Purchase Power is simple and straightforward. Customers can apply for the service at the checkout on participating merchants’ websites. They will be required to provide some basic personal information, such as their name, address, date of birth, and social security number. Klarna will then run a soft credit check to determine the customer’s eligibility for the service.

  • Approval Process

If a customer is approved for Klarna Purchase Power, they can complete their purchase and make their first payment at checkout. The remaining payments will be automatically deducted from their payment method every two weeks.

  • Payment Schedule

Klarna Purchase Power offers a flexible payment schedule that allows customers to split their payments into four equal installments. The first payment is due at the time of purchase, with the remaining payments due every two weeks. Customers can choose to pay early at no additional cost or set up autopay for added convenience.

Advantages and disadvantages of Klarna Purchase Power

It is important to explore the advantages and disadvantages of Klarna Purchase Power before using the service. This way you’ll make your financial decisions more confidently. Knowing the benefits and drawbacks of the service can help you weigh the costs and benefits and determine if Klarna Purchase Power is the right financing option for you. 

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Advantages of Klarna Purchase Power

The advantages of the service include the flexibility of choosing  payment options, absence of fees, and convenience, which increases customer satisfaction with purchasing. Let’s break them down.

Flexible Payment Options

One of the significant advantages of Klarna Purchase Power is its flexible payment options. Customers can split their payments into four equal installments, which can help them manage their cash flow and budget their expenses effectively.

No Interest or Fees

Unlike traditional financing options, Klarna Purchase Power does not charge any interest or fees. Customers can enjoy the convenience of spreading out their payments without incurring any additional costs.


Klarna Purchase Power is available for purchases made on participating merchants’ websites, making it a convenient payment option for customers. The service is also easy to use, with a simple application process and flexible payment schedule.

Increased Buying Power

Klarna Purchase Power can increase customers’ buying power by allowing them to make purchases that they might not be able to afford upfront. By splitting their payments into four equal installments, customers can enjoy the flexibility of financing their purchases without incurring any interest or fees.

Disadvantages of Klarna Purchase Power

Still, there are some drawbacks to the use of the service you might want to know about before you decide to go with it. Those include:

Late Fees

While Klarna Purchase Power does not charge interest or fees, customers should be aware that late payments can result in additional fees. If a payment is not made on time, customers may be subject to a $7 late fee. Additionally, if a payment is still outstanding after ten days, customers may be charged a further $7 fee.

Impact on Credit Score

Klarna Purchase Power may impact a customer’s credit score, as Klarna will perform a soft credit check to determine eligibility for the service. While a soft credit check does not have a significant impact on a customer’s credit score, customers should be aware that multiple applications for financing can lower their credit score.

Alternatives to Klarna Purchase Power

While Klarna Purchase Power is a convenient and flexible financing option, it may not be suitable for everyone. Customers who are looking for alternatives to Klarna Purchase Power may consider the following options:

Credit Cards

Credit cards offer a flexible financing option for customers, with the ability to make purchases and pay them off over time. Many credit cards offer rewards programs, cashback, or other benefits that can be advantageous for customers who use them responsibly.

Personal Loans

Personal loans are another financing option that customers can consider. Personal loans typically offer a fixed interest rate and repayment term, which can help customers manage their debt more effectively.

Layaway Programs

Layaway programs allow customers to pay for their purchases in installments, but unlike Klarna Purchase Power, customers do not receive their purchases until they are paid in full. Layaway programs can be a good option for customers who are looking to avoid interest or fees and prefer a more structured payment plan.

Read our articles to learn How to Check your Klarna spending limit and How to Increase your Klarna limit.


Klarna Purchase Power is a flexible and convenient financing option for customers who are looking to spread out their payments without incurring any interest or fees. The service offers a range of features that make it an attractive option for online shoppers, including flexible payment options, no interest or fees, and increased buying power. However, customers should be aware of the potential disadvantages, including late fees and the impact on their credit score. Customers who are considering Klarna Purchase Power may also want to explore alternative financing options, such as credit cards, personal loans, or layaway programs.

Disclaimer: This article is intended to provide general information about how to use Klarna. The information provided in this article is not intended to be a substitute for professional advice or guidance and should not be relied upon as such. The use of Klarna may vary based on factors such as geographic location, Klarna terms and conditions, and particular merchant’s requirements. Readers are advised to do their own research and seek professional advice before making any financial decisions.

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