Klarna
Reddit take
Not enough linked mention summaries yet; the source excerpts below are the evidence.
Cons
- Klarna charges a higher merchant fee than credit cards and they can get away with that bc studies have shown people will spend more money, and complete more purchases they would've abandoned, with the "pay in 4" option.
- We had someone here a few months ago who had $900 in monthly Klarna payments and was wondering how to get out of it because they couldn't afford it.
- Klarna pay over 4 with no interest is a nice tool to break up large expenses. But for someone with a track record of over spending on a credit card simply because they had access to the credit line, this is a terrible trap.
- Klarna is no different than credit cards, debt is debt. Overspending is overspending
- To me, it sounds a lot like the payday loan trap I fell into before I met him. Right now, our total owed to Klarna is over $900.
Sentiment
0 positive (0%) · 1 mixed (10%) · 9 negative (90%)
Trust + time weighted score: -90% · raw score -90%
What redditors said (10 of 10)
Klarna charges a higher merchant fee than credit cards and they can get away with that bc studies have shown people will spend more money, and complete more purchases they would've abandoned, with the "pay in 4" option.
We had someone here a few months ago who had $900 in monthly Klarna payments and was wondering how to get out of it because they couldn't afford it.
Klarna pay over 4 with no interest is a nice tool to break up large expenses. But for someone with a track record of over spending on a credit card simply because they had access to the credit line, this is a terrible trap.
Klarna is no different than credit cards, debt is debt. Overspending is overspending
To me, it sounds a lot like the payday loan trap I fell into before I met him. Right now, our total owed to Klarna is over $900.
The only people that should use Klarna are those that have no intention of paying it back. See it as free money for those with a credit score under 600. Interest free loan for some other 0.1% minority. The rest are likely to get fucked.
Klarna is a bust out stock. Watch its financials. The entire model is based on profit from fees from people that don't make the payments. Yet expects them to pay... ok.
Debt accrued via Klarna and other apps is not currently factored into your debt load, which is very dangerous. It's starting to change but you could have $1000 a month in klarna payments and not have that appear in your credit report when you're applying for cars/houses/etc. That is very very bad.
nearly every loan I look at these days has Klarna/Afterpay/Affirm/Sezzle/Paypal/Shoppay accounts. These usually aren’t derailing the mortgage (usually…) but they slow down the process and cause undue stress for everyone.
Parent context: How do they get people to pay? Do they just let fees stack up and then hit people with a lawsuit for the money? What if the person has no assets or wages to garnish? Reply: then they repo the dinner. easy.