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Does Klarna Affect Your Credit Score?


In the rapidly evolving world of online shopping, ‘Buy Now, Pay Later’ (BNPL) services have emerged as a popular alternative to traditional payment methods. Leading the charge in this domain is Klarna, a Swedish fintech company that has gained significant traction in the UK market. Klarna offers a range of payment solutions designed to simplify the online shopping experience and provide consumers with greater flexibility. However, as with any financial service, it’s important to understand the potential implications on your credit score. This article aims to shed light on Klarna’s services and their impact on your credit score, helping you make informed decisions about using this innovative payment platform. Let’s dive in!

Klarna’s Services

Klarna, a pioneer in the ‘Buy Now, Pay Later’ (BNPL) industry, offers a suite of payment solutions that cater to a variety of consumer needs. The company’s services are primarily divided into three categories: ‘Pay 30 days later’, ‘Instalments’, and ‘Financing’.

  1. Pay 30 days later: This service allows customers to make a purchase and pay for it 30 days later. It’s a convenient option for those who want to try before they buy or need a little more time to pay.
  2. Instalments: With this option, customers can split their payment into three equal instalments, spread over 60 days. There are no interest charges or fees, making it a budget-friendly choice for many shoppers.
  3. Financing: For larger purchases, Klarna offers a financing option. Customers can spread the cost over several months or even years. The terms and interest rates vary depending on the retailer and the customer’s creditworthiness.

These services have made Klarna a popular choice among UK consumers, with ‘Pay 30 days later’ and ‘Instalments’ being the most widely used products.

Credit Checks and Klarna

When it comes to credit checks, it’s important to understand the difference between ‘soft’ and ‘hard’ checks. A ‘soft’ credit check is a preliminary look at certain information on your credit report. This type of check does not affect your credit score. On the other hand, a ‘hard’ credit check provides a full view of your credit history and can slightly lower your credit score.

Klarna performs a ‘soft’ credit check when you use their ‘Pay 30 days later’ and ‘Instalments’ services. This means that using these services will not impact your credit score. However, for Klarna’s ‘Financing’ service, a ‘hard’ credit check is undertaken. This is because ‘Financing’ is Klarna’s only regulated credit product, and the terms and interest rates offered are dependent on the customer’s creditworthiness.

Klarna and Credit Scores

While Klarna’s ‘Pay later’ products do not impact your credit score directly, it’s important to understand how they interact with your credit report. Even if you fail to pay on time, using Klarna’s ‘Pay later’ products does not impact your credit score. However, this does not mean that late or missed payments are without consequences. Klarna may charge you a late fee, and continued missed payments could result in your account being handed over to a debt collection agency.

In June 2022, Klarna started reporting to credit agencies. This means that Klarna transactions are now reported to all major UK referencing agencies and recorded on your credit report. While this does not affect your credit score directly, lenders may consider this information when assessing your creditworthiness for future loans or credit applications.

Responsible Use of Klarna

While Klarna’s services offer convenience and flexibility, it’s crucial to use them responsibly to avoid any potential negative impacts on your credit score. Here are some tips for responsible use:

  1. Understand the Terms and Conditions: Before using any of Klarna’s services, make sure you fully understand the terms and conditions. This includes the payment schedule, any interest or fees that may apply, and the consequences of late or missed payments.
  2. Meet Payment Terms: Always aim to meet the payment terms. If you’re using the ‘Pay 30 days later’ or ‘Instalments’ services, ensure you pay within the stipulated time frame to avoid late fees. If you’re using the ‘Financing’ service, keep up with your monthly payments to avoid negatively impacting your credit score.
  3. Monitor Your Spending: While Klarna makes it easy to buy now and pay later, it’s important to monitor your spending to avoid accumulating debt. Only purchase what you can afford to pay back within the agreed time frame.
  4. Contact Klarna If You’re Struggling: If you’re having trouble making payments, contact Klarna’s customer service. They may be able to help you work out a payment plan and avoid negative impacts on your credit score.


In conclusion, Klarna’s ‘Buy Now, Pay Later’ services offer a convenient and flexible way to manage online purchases. However, it’s crucial to understand the potential implications on your credit score. Always read the terms and conditions before entering into any agreement with Klarna or any other financial service provider.

Remember, while Klarna’s ‘Pay later’ products do not directly impact your credit score, late or missed payments can lead to additional fees and potential debt. Therefore, responsible use of these services is key to maintaining good financial health.

Please note that since the time of writing this article, changes may have been made to Klarna’s services and policies. Therefore, it’s always a good idea to check Klarna’s official website for the most up-to-date information.

Finally, this article is intended to provide general information and is not financial advice. Always seek professional advice before making any financial decisions.