Klarna is a payment method that allows your customers to pay you right away, in 30 days without any fees, and in instalments. This method is especially popular among European shoppers.
Please note that when customers choose Klarna as the payment method, they can only pay with the local currency. For example, buyers from Sweden can only pay in Swedish kroner.
Klarna is set up through Stripe, a fast and trustworthy payment gateway that allows you to receive a variety of payment methods from all over the world including credit and debit cards, mobile wallets, and dozens of other options your customers prefer.
Klarna is available only for merchants from Europe.
Requirements for using Klarna
Before setting up Klarna, make sure that your store meets the following requirements:
- Regions: Klarna is available as the payment option at checkout for customers from Austria, Belgium, Czechia, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Poland, Portugal, Spain, Sweden, Switzerland, and the United Kingdom.
- Currencies: Klarna works with Euro, British Pound, Czech Krona, Danish Krone, Norwegian Krone, and Sweden Krona. Please note that the currency in your store must match the currency that Klarna supports for your country. You can change your store currency from the store admin, in Settings → General → Regional Settings → Currency.
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Product categories: By enabling Klarna with Stripe, you are accepting Klarna Merchant Services Agreement and confirm that your business doesn’t operate within Klarna Restricted Business Categories. That includes travel (including travel agents, car rental, and hotels), ticketing (including event tickets), booking services, digital goods and services, marketplaces and others.
Klarna also have Ethical instructions for merchants (pdf) which states the company's ethical standards. Among restricted are alcohol products; products or services, which is intended to cause danger, injury or suffering to humans or animals; products and services (e.g. fireworks, prescription drugs, weapons and armaments) provided without appropriate licenses; adult, sexual or pornographic products and services, including live web cam; electronic cigarettes (including e-liquid), etc. - Legal pages: Before you start accepting live payments with Klarna, make sure to update your Terms and Conditions and Privacy Policy according to Klarna Data Protection and Privacy Requirement.
Setting up Klarna
To accept Klarna payments, you can simply add Klarna payment method in your Stripe account connected to your store. If you don’t have a Stripe account, you can create one fast and easily.
Please note that the currency in your store must match the currency that Klarna supports for your country.
To accept payments in your online shop via Klarna:
- From your store admin, go to Payment.
- Scroll down and Choose Payment Method → Klarna (via Stripe).
- Click Connect Klarna. You’ll be redirected to the Stripe website where you can login into your existing Stripe account or create a new one.
If you create a new Stripe account, you’ll need to fill in the information about your business and then Stripe will connect to your store. After that you will be redirected to your store.
If you already connected your Stripe account to your store, you need to log in to your Stripe account and the Klarna payment method will be added to your store. After that you will be redirected to your store. - Make sure that Klarna payment method is activated in your Stripe account. To check it, click on the Manage account button in your store or open your Stripe Dashboard:
On your Stripe Dashboard, go to Settings → Payment Methods and find the Klarna method. If you see Activate next to the Klarna method, click on it and fill in the additional information. You may also see the Request access button, click on it to activate Klarna:
The Klarna Merchant Services Agreement will pop up and you have to agree with it by clicking Confirm.
Stripe may ask you to provide more information about your business to accept payments with Klarna:
Click Provide info and in the popped-up window click on settings. You will be redirected to Stripe’s Settings page where you’ll need to fill in the information about your business.
If you have any questions about activating a payment method in your Stripe account, contact Stripe’s support for more information. - In the Appearance options section, turn on toggles to enable a particular payment method type at checkout. To change the payment title at checkout, click Edit name for payment option. For example, rename Pay later to Buy Now, Pay Later.
- (optional) If your site is multilingual, you can add a translation for the payment option title.
- (optional) In the Payment instructions for customers field you can add a description of the Klarna payment method for your customers, it will appear at the checkout. For example, describe the flexibility of delayed payment that Klarna provides to your buyers.
- (optional) Click Limit availability by shipping method to limit the Klarna payment option to a specific shipping or delivery method.
That’s it. Now you can accept payments in your online shop via Klarna:
Accepting Klarna payments
After you enable Klarna in your store, your customers will be able to choose Klarna as their payment method. Once they choose it, they will be redirected to the Klarna website where they can choose one of the three payment options: Pay now, Pay later or Slice it (also called Installments). These different payment options let customers pay immediately, by invoice, or through installments using direct debit or credit card.
Payment options that Klarna offers are based on the customer’s location. Please note that when customers choose Klarna as the payment method, they can only pay with the local currency. For example, buyers from Sweden can only pay in Swedish kroner.
Klarna Pay Now method lets customers pay for the order using their online banking details. If your customers choose to pay now, they have to fill in the billing address on your store checkout page. Depending on the location customers may need to fill in additional information. After entering information and clicking Continue, your customers will be redirected to the Klarna website to proceed with payment.
Klarna Pay Later allows your customers to order first and pay 30 days after purchase without any fees. After placing the order, customers will get a bill from Klarna. No matter when your customers decide to pay, Klarna will pay for the order up front and in full. To learn more about the Pay later method, watch this video from Klarna.
Klarna Slice it (Installments) gives your customers the option to pay in 4 interest-free installments. In that case while authorizing the payment, Klarna will show your customers their payment plan. For example, if they bought an item in your shop that costs €120, they will have to pay €30 every 2 weeks. Here’s a quick video about Slice it payment method, explaining how the payment process looks like.
After completing the order, customers will get an email with a payment link. Once Klarna collect their first installment, you will be paid by Klarna for the order up front and in full.
For customers from the UK the orders paid with Klarna have Awaiting Payment status for up to 24 hours from their creation. Once the charge is confirmed and the funds are guaranteed, the order status automatically changes to Paid. In other countries the payment status of the order gets updated immediately.
You can always check what payment method has been used for an order by viewing an order’s details in your store admin, My Sales → Orders.
Processing orders paid with Klarna
Klarna requires merchants to ship the order within 28 days of placement. Otherwise, Klarna will recognize the order as outstanding and automatically make the refund.
To avoid the refund, you need to ship the item within 28 days and change the status to Shipped or Delivered.