Klarna Launches Mobile Phone Service in the US

Klarna, the buy-now-pay-later service, is launching a mobile phone service. The $40 per month phone plan is set to launch in the United States in the “coming weeks,” offering unlimited 5G data, calls, and texts on AT&T’s network. This move positions Klarna as yet another mobile virtual network operator (MVNO) in an increasingly crowded telecommunications market.

Understanding MVNOs

Mobile virtual network operators (MVNOs) are companies that provide phone services by utilizing another carrier’s network infrastructure. The popularity of MVNOs has surged in recent years, with notable brands such as Mint Mobile, Visible by Verizon, Cricket Wireless, and Xfinity Mobile leading the charge. Now, Klarna joins this competitive landscape with its new offering Trump Organization’s new phone service.

Service Features and Sign-Up Process

Klarna’s mobile service is powered by Gigs, a platform that enables companies to launch their own MVNOs a firm that’s supposed to make it easier. Users can sign up directly through the Klarna app, which promises no contracts or hidden fees. Additionally, customers have the option to transfer their existing phone number to Klarna or obtain a new one with “instant eSIM activation.”

Klarna’s Core Business and Recent Developments

Klarna’s primary business model revolves around its buy-now-pay-later (BNPL) service, which allows customers to split their purchases into four separate payments. However, a recent study from the Consumer Financial Protection Bureau revealed that BNPL users tend to accumulate more debt than those who do not use such services discovered that frequent BNPL users. Furthermore, a separate study indicated that 41 percent of BNPL users reported making late payments in the past year a recent survey from LendingTree. In response to these concerns, last month, the Trump administration proposed regulations to subject BNPL companies to stricter oversight dropped the CFPB’s plan to stricter rules.

Klarna’s Vision for the Future

With the introduction of its mobile phone service, Klarna aims to expand its offerings beyond BNPL. On Wednesday, Klarna CEO Sebastian Siemiatkowski expressed his vision for the app to evolve into a “digital financial assistant.” This assistant would leverage artificial intelligence to identify instances where users may be overpaying for services and provide suggestions for better pricing models. Users would then have the ability to implement these suggestions with a simple click.

Availability and Future Plans

Currently, users in the United States can join the waitlist for Klarna’s mobile phone service. The company has also announced plans to launch the service in the UK, Germany, and other countries in the near future.