Fintech Startup Klarna Faces Pressure as Consumers Take Micro-Loans to Pay for Necessities

Fintech Startup Klarna Faces Pressure as Consumers Take Micro-Loans to Pay for Necessities
A smartphone displays a Klarna logo on top of banknotes is in this illustration taken on Jan. 6, 2020. Dado Ruvic/Illustration/Reuters
|Updated:
0:00

A Swedish fintech company with a novel premise is facing complications as a wave of consumers taking micro-loans to pay for necessities such as rent and groceries threatens the company’s business model.

Klarna Bank AB, the above-mentioned fintech company, has seen a rapid drop in its valuation after a disappointing round of financing drew in only $800 million, as investors become warier of the company’s ability to maintain its unique business model.