Klarna vs. Affirm: The BNPL Race Intensifies
Hey FinTech Fanatic!
The competition between Klarna and Affirm is becoming harder to ignore, shaping the fintech industry with their moves in digital payments and alternative banking. Klarna is pushing forward with its U.S. fintech IPO, expanding its payments innovation strategy, while Affirm is securing fintech partnerships and entering new markets. Their rivalry is now one of the most closely watched battles in digital finance and online payments.
Klarna has been expanding rapidly across digital banking trends. It recently struck deals with Nexi in Europe, J.P. Morgan Payments, and Stripe, strengthening its position in open banking and instant payments. Last week, it officially filed for its IPO at the NYSE, marking a significant move in the fintech funding landscape.
This week, Klarna landed a major win, becoming the exclusive BNPL provider for Walmart’s OnePay, shaking up the mobile payments space. The deal sent Affirm’s shares tumbling 11% in premarket trading. Klarna also just partnered with DoorDash, adding contactless payments and flexible payment methods for millions of customers ordering food, groceries, and essentials.
Meanwhile, Affirm is doubling down on embedded finance and digital banking innovation. It will remain the exclusive provider of Shop Pay Installments in the U.S. and is set to expand its fintech solutions to Canada. This move strengthens its cross-border payments strategy and extends its global footprint, with upcoming plans to enter the UK.
Affirm has also expanded its fintech ecosystem, adding Stitch Fix to its fashion merchant network and teaming up with FIS to integrate BNPL into banking apps. Yesterday, Affirm announced two more major moves: it's expanding its credit reporting with Experian to include all of its pay-over-time products. At the same time, it’s deepening its partnership with Adyen, in order to bring its BNPL offerings to the UK.
Interestingly, both companies have aligned with major payments players on opposite sides of the Atlantic. Klarna, the European fintech unicorn, has partnered with U.S.-based Stripe, while Affirm, the U.S. neobank, has teamed up with Adyen, one of Europe’s leading payment apps.
As Klarna prepares for its NYSE debut, while Affirm continues trading on Nasdaq, their fintech disruption is set to intensify. Their battle in the future of finance is far from over, and how they continue to shape the BNPL, digital banking, and open finance landscape will be fascinating to watch.
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FINTECH NEWS
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🌎 LoanPro and NovoPayment partner to expand access to credit in Latin America. This partnership enhances digital finance and business banking by combining NovoPayment’s open banking API-based processing with LoanPro’s credit solutions, enabling financial institutions to scale modern credit products.
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🇧🇷 Burger King and Nubank expand their fintech partnerships with exclusive benefits. The initiative strengthens mobile banking adoption while promoting digital payments through embedded finance solutions that enhance customer experience.
🇺🇸 Ribbit Capital is raising a new $500M fund, according to a U.S. Securities and Exchange Commission (SEC) filing. The new capital appears to be part of the Palo Alto-based venture firm’s latest fintech investments, positioning it to fund the next wave of early-stage fintech startups.
PAYMENTS NEWS
🇸🇪 Tink hits 10,000 merchant milestone for open banking payments. Through direct payment partnerships and integrations with leading PSPs, Tink’s Pay by Bank solution is now widely available, strengthening the fintech ecosystem and driving real-time payments adoption.
🇬🇧 Affirm and Adyen expand their payments innovation partnership. Adyen’s UK merchants can now seamlessly integrate BNPL solutions, offering customers mobile payments with interest-free and interest-bearing installment options.
🇸🇪 Trustly becomes the first payment provider to support Sweden’s central bank instant settlement system. This move marks a key step in banking innovation, offering instant payments coverage for all bank accounts in Sweden and further advancing the digital banking trends in Europe.
🇬🇧 Worldpay and Visa partner to enhance contactless payments with click-to-pay solutions. This fintech industry collaboration supports businesses, optimizes checkout processes, and reduces cart abandonment in online payments. Keep reading.
DIGITAL BANKING NEWS
🇬🇧 Monzo introduces backup banking for system outages. Named Monzo Stand-in, the digital bank solution ensures users can still make payments, withdraw cash, and access their bank accounts even during technical disruptions, enhancing banking innovation. Read more.
🇧🇷 Nubank launches Boleto Compartilhado in-app functionality. The new feature improves mobile banking and business banking by allowing users to split expenses seamlessly through shared online payments.
🇬🇧 Bank of London changes its name as accounts now nearly six months overdue.. The company, formerly The Bank of London Group Holdings Limited, is now Oplyse Holdings, though the reason for the change remains unclear. Read on.
BLOCKCHAIN/CRYPTO NEWS
🇳🇬 Quidax joins Busha, listing cNGN, Nigeria’s first stablecoin pegged to the naira. This move signals Nigeria’s evolving approach to crypto regulation, balancing oversight with the growing adoption of blockchain technology and cryptocurrency trading.
🇰🇷 Bank of Korea to launch a CBDC pilot for real-world digital payments. Project Hangang will involve 100,000 participants converting their bank deposits into digital tokens, advancing blockchain in banking and Web3 banking initiatives.
🇵🇰 Pakistan moves to legalize cryptocurrency to attract fintech investments. The country aims to develop a clear crypto regulation framework to strengthen crypto trading and foster a crypto-friendly banking ecosystem. Continue reading.
🇪🇸 Vivid Money introduces the first Crypto Earn Account for SMEs, integrating DeFi and crypto wallet functionality. Businesses can stake crypto assets to earn passive income, making blockchain solutions more accessible for enterprises.
🇺🇸 MoonPay secures a $200M credit line from Galaxy Digital, reinforcing its ability to handle surging crypto transactions and meet crypto wallet liquidity demands without delays.
PARTNERSHIPS
🇬🇧 Allica Bank to double accountancy partnerships team to meet demand for business banking expertise. Allica’s corporate banking partnership team was set up to help accountants fill the gap left by high-street banks in providing banking support for businesses, leveraging digital finance and banking innovation.
🇦🇪 Visa and Emirates NBD Pay launch advanced payment gateway with enhanced secure payments infrastructure. Cybersource will be incorporated into the platform, offering clients payment methods powered by AI in payments, fintech cybersecurity, and open banking compliance solutions.
🇬🇧 Spendesk and Wise Platform expand their cross-border payments capabilities, enabling 5,000+ businesses to process real-time payments in 30 currencies. This integration enhances online payments, mobile payments, and embedded finance solutions for global businesses.
🌍 Pleo and Taktile partner to improve fintech compliance and regtech with AI in compliance and digital identity verification. This move enhances fraud detection and strengthens the security of fintech solutions for scalable growth.
🇺🇸 DoorDash partners with Klarna to offer flexible payment methods for U.S. customers. Users can now leverage digital wallets and contactless payments when purchasing groceries, retail, or DashPass Annual Plans, supporting the fintech adoption of payment apps.
DONEDEAL FUNDING NEWS
🇵🇭 Higala expands fintech funding to $2.8M, fueling its instant payments system and digital bank expansion. This funding will also accelerate open banking adoption and strengthen its fintech ecosystem.
🇧🇪 Belgian fintech startup Warren secures €3M to tackle workplace financial stress. The funding will support AI in investing and wealthtech innovations, providing employees with digital finance tools, including AI-driven coaching and advisory services.
🇩🇪 Flexvelop raises €44M to scale its fintech platform. The financing supports the company’s transformation from a fintech startup to a key player in the alternative banking sector, driving fintech disruption with cutting-edge banking-as-a-service solutions.
M&A
🇺🇸 Kraken acquires NinjaTrader for $1.5B, reinforcing its dominance in crypto trading and expanding its blockchain-powered crypto-friendly banking ecosystem. This move cements Kraken as a leader in DeFi, Web3 banking, and digital finance.
🇫🇷 France's Credit Mutuel to buy German banking IPO candidate OLB. This acquisition strengthens corporate banking ties between France and Germany, enhancing banking innovation and fostering open finance partnerships across Europe. The price tag for OLB is close to 2 billion euros.
🌍 Muinmos acquires equity stake in Africa Due Diligence, expanding its regtech capabilities. This investment enables fintech companies to access secure payments and digital identity verification for safer business transactions in emerging markets.
🇮🇹 TPG offers over €800M for a unit of Italy's Nexi. This potential deal could free up resources for Nexi’s expansion in embedded finance, instant payments, and payment apps innovation.
MOVERS AND SHAKERS
🇺🇸 Bakkt names new co-CEO amid a strategic shift toward crypto wallet services. Akshay Naheta will lead the company’s renewed focus on cryptocurrency trading, shedding non-core services to align with the future of finance in blockchain in banking. Read more.
🇬🇧 Monzo appoints Andy Smart as the new CPO, reinforcing its position as a leading neobank and digital bank. Andy joined in 2016 as one of Monzo’s first 20 employees and during his career has served in several significant positions across the technology platform including being appointed Monzo’s first Vice President of Engineering, and acting as Interim CTO.
🇬🇧 Trading 212 Chairman Andrew Bole steps down, marking a shift for the fintech industry. Last year he had also stepped down from the board of institutional multi-asset brokerage Britannia Global Markets Limited, where he served as non-executive Chairman.
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