Klarna has announced the opening of its waitlist for the “new and improved” Klarna Card in the U.S. The credit card is replacing the version of the card that launched in 2022.
Unlike traditional credit cards, the new Klarna Card issued by WebBank will function more like a charge card that requires a payment in full to avoid interest, with some exceptions. Interest will apply for those few built-in options that allow more time to pay off a purchase.
Here’s what’s in store for the Klarna Card.
The new changes
The Klarna Card will no longer charge the $4.99 monthly fee or offer the “Pay in 4” option. (Customers can still use “Pay in 4” plan through Klarna’s app.) The Klarna Card can be used wherever Visa is accepted, whether that’s in-store or online, or even internationally. To qualify, you must meet the credit criteria and be at least 18 years old, a U.S. resident and a Klarna customer with at least one on-time payment.
The Klarna Card differs from traditional credit cards with its payment options that don’t allow revolving balances. You’ll only be able to pay the monthly statement early or in full to avoid interest charges.
Interest will apply if you choose to move the purchase due date to the next month’s statement or pay eligible purchases over time in three or six monthly payments. While there is no limit to the number of purchases you can move onto the interest-charging options, every purchase will qualify for a longer payment window only once.
Other features of the card will include:
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10% cash back on purchases made through Klarna’s app.
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No foreign transaction fees.
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Integration with the Klarna app and Klarna’s AI assistant to find deals.
The company has plans to report payments made on the Klarna Card to the credit bureaus in the future, but the timing of it is still being worked out. Credit reporting would allow customers who lack access to credit to potentially have another option to get started, if they can qualify. Klarna doesn’t currently report data from its buy now, pay later options to credit bureaus in the U.S.
How it compares to traditional credit cards
Unlike some traditional credit cards, the Klarna Card will have built-in mechanisms to prevent debt from spiraling. It’s worth noting, though, that paying off a bill in full to avoid interest charges has long been an option on traditional credit cards.
Some major issuers also already provide similar pay-over-time options on credit cards that allow users to pay off eligible purchases over several fixed installments. The Klarna Card also doesn’t beat the savings you’ll get with a 0% introductory APR if you need an interest-free window of six months or longer to pay off purchases.
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