Klarna is looking to stand out in a growing installment payment space by launching a new loyalty program within its “buy now, pay later” platform. Dubbed Vibe, the just-announced rewards program will launch in the U.S. in June, and will be extended to the Swedish fintech’s other major markets, including Germany, the U.K., Sweden and Australia.
For every dollar spent through the Klarna app, consumers participating in the program will earn one “Vibe.” Members can then redeem these Vibes for rewards such as gift cards redeemable at major retailers. Free to join, the Vibe program enables users to earn rewards throughout Klarna’s 200,000-strong merchant network.
Members also will have access to exclusive online and offline sales and shopping experiences and can earn an extra layer of rewards if they are already part of an existing loyalty program through the retailer that they are purchasing from.
Last week, Klarna announced that its pay-later app has attracted more than 1 million monthly active U.S. shoppers, and 7.85 million U.S. consumers total, a number that is largely driven by apparel, beauty and footwear brands. The app has been downloaded more than 4.4 million times, with more than 1.7 million downloads coming in 2020 alone.
The Swedish bank, whose valuation has reached $5.5 billion, is the largest private fintech firm in Europe and has continued to expand into U.S. retail, adding ModCloth as a new retail partner just last month. Klarna has seen its number of U.S. retail partners grow by 163 percent year over year as of May, with more than 4,200 U.S. retailers, including Abercrombie & Fitch, Indochino, Nike, Rue21 and Toms, now numbering among the company’s worldwide network.
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“We’re extremely proud to be the first company in the buy now, pay later space to offer a personalized rewards program,” said Sebastian Siemiatkowski, CEO of Klarna. “We’re laser focused on providing our nearly 8 million U.S. consumers with the most convenient, seamless and enjoyable shopping experience possible, from end to end, and the Vibe program builds on our efforts and success. Vibe members have the freedom to shop everywhere and will enjoy access to unique, tailored benefits from hand-picked partners in addition to exclusive offers, deals and other rewards.”
The fintech company said it developed the Vibe program with direct input from customers, some of whom said they find traditional credit card loyalty memberships confusing and difficult to navigate. With Vibe, Klarna aims to extend the wider eligibility associated with credit card rewards programs to its credit-averse users.
Klarna has expanded beyond typical online installment payments, having launched in-store financing options in the U.S in January. Klarna is partnering with retailers such as H&M, Rue21, Good American and Planet Blue on store reopening strategies, including focusing on the safety aspects such as contactless payments. To date, Klarna is live in more than 11,000 brick-and-mortar stores worldwide.