6 votes

Sweden's Klarna becomes biggest fintech firm in Europe – operator valued at $5.5bn after fresh round of investor funding

17 comments

  1. [15]
    cwagner
    Link
    The last time I looked into them, they (and their competitors) required you to give them your banking login and password. And I just checked: Yes, they do. This is madness.

    The last time I looked into them, they (and their competitors) required you to give them your banking login and password.

    And I just checked: Yes, they do. This is madness.

    3 votes
    1. [2]
      vegai
      Link Parent
      Are you sure? The first time I used a Klarna-integrated shop, I entered my address, email and social security number. After every following purchase, they ask my social security number and that's...

      Are you sure? The first time I used a Klarna-integrated shop, I entered my address, email and social security number. After every following purchase, they ask my social security number and that's it. I get a monthly bill from them that pools all purchases.

      3 votes
      1. cwagner
        Link Parent
        We don’t have social security numbers. Also check my other comment regarding different Klarna methods.

        We don’t have social security numbers. Also check my other comment regarding different Klarna methods.

        3 votes
    2. [3]
      imperialismus
      Link Parent
      Whenever I've used Klarna, they sent me an electronic invoice which I paid manually. It required no further trust than any other invoice I've ever received.

      Whenever I've used Klarna, they sent me an electronic invoice which I paid manually. It required no further trust than any other invoice I've ever received.

      2 votes
      1. [2]
        cwagner
        Link Parent
        Hm, I think there are different ways to use Klarna? The one I tested was Klarna Sofort which might be a payment method they offer only in Germany?

        Hm, I think there are different ways to use Klarna? The one I tested was Klarna Sofort which might be a payment method they offer only in Germany?

        3 votes
        1. Spel
          Link Parent
          Yeah, Sofort is a German service that Klarna acquired in 2014 and still run in parallel with their own in a few countries.

          Yeah, Sofort is a German service that Klarna acquired in 2014 and still run in parallel with their own in a few countries.

          2 votes
    3. [9]
      cfabbro
      (edited )
      Link Parent
      WTF!? Do Swedish/European banks not support any APIs for securely linking bank accounts to third-party payment processors (and then verifying ownership of that account via random deposit amount...

      WTF!? Do Swedish/European banks not support any APIs for securely linking bank accounts to third-party payment processors (and then verifying ownership of that account via random deposit amount confirmation), like the NA ones do?

      If not, madness indeed. There is no way in hell I would trust a third-party payment processor with knowing anything more than just my account #.

      1 vote
      1. [6]
        mycketforvirrad
        Link Parent
        We do. A secure connection is made for most online payment methods via an independent API that requires your private national ID number (twelve digits) alongside a six digit pin code.

        We do. A secure connection is made for most online payment methods via an independent API that requires your private national ID number (twelve digits) alongside a six digit pin code.

        2 votes
        1. [5]
          cfabbro
          Link Parent
          Ah, so this is just these fintech companies being particularly shady/lazy/stupid then? I'm surprised a third-party processor requiring a user's banking login/password is even legal, TBH,...

          Ah, so this is just these fintech companies being particularly shady/lazy/stupid then?

          I'm surprised a third-party processor requiring a user's banking login/password is even legal, TBH, especially in this day & age of regularly occurring large scale data breaches.

          1 vote
          1. [4]
            mycketforvirrad
            Link Parent
            I can only vouch for Klarna and Swish here in Sweden that utilise the BankID system to transfer money. All seem reasonably secure (to my limited knowledge in the field) and are pretty widely used...

            I can only vouch for Klarna and Swish here in Sweden that utilise the BankID system to transfer money. All seem reasonably secure (to my limited knowledge in the field) and are pretty widely used here.

            2 votes
            1. [3]
              cfabbro
              (edited )
              Link Parent
              I suppose I don't really know nearly enough to comment on whether or not that is secure either. However at least all the payment processors I have linked to my bank accounts (e.g. paypal) have...

              I suppose I don't really know nearly enough to comment on whether or not that is secure either. However at least all the payment processors I have linked to my bank accounts (e.g. paypal) have only ever required my bank transfer, institution & account # (all visible on a cheque anyways), and then I verified my ownership of the account via confirming the random amount they deposited. And perhaps I am overly paranoid, but there is absolutely no way I would ever trust a third-party payment processor with my actual banking login & password, as handing those over to someone seems insane to me.

              2 votes
              1. [2]
                mycketforvirrad
                Link Parent
                My knowledge in this area is purely limited to being a user, as opposed to anything technical. BankID is used in most online interactions here in Sweden, it isn't purely your bank account number...

                My knowledge in this area is purely limited to being a user, as opposed to anything technical. BankID is used in most online interactions here in Sweden, it isn't purely your bank account number and sort code stored. It is heavily integrated with your government ID and is used when dealing with taxes, unemployment benefit etc online. It is pretty much your legal online ID. You can optionally tie it to your bank account and gain the security it provides to authorise online payments. I'd love if a more technical minded Swede could jump in here and take the baton. I feel a little out of my depth as a layman. :P

                1 vote
                1. cfabbro
                  Link Parent
                  Ditto. So I too would love it if someone working in banking and/or datasec could comment on this. :P

                  My knowledge in this area is purely limited to being a user, as opposed to anything technical.

                  Ditto. So I too would love it if someone working in banking and/or datasec could comment on this. :P

                  2 votes
      2. [2]
        cwagner
        Link Parent
        PayPal works the same way here (confirmation and later you pay via lastschrift a pull wire transfer). I don’t know what those fintech startups do that they need my banking login, but I won’t give...

        PayPal works the same way here (confirmation and later you pay via lastschrift a pull wire transfer). I don’t know what those fintech startups do that they need my banking login, but I won’t give it to them anyway.

        2 votes
        1. chembliss
          Link Parent
          Probably they want to get more data (i.e. everything you do with your bank account). It would be interesting to read their privacy policy.

          Probably they want to get more data (i.e. everything you do with your bank account). It would be interesting to read their privacy policy.

          2 votes
  2. [2]
    kfwyre
    Link
    When I last looked into Klarna (admittedly a while ago), they would only negatively report to credit agencies in the US, so you received no potential credit score benefit from accepting and paying...

    When I last looked into Klarna (admittedly a while ago), they would only negatively report to credit agencies in the US, so you received no potential credit score benefit from accepting and paying off their financing but your score could still take a hit for failing to pay. That felt one-sided to me. Also, a lot of their "buy now, pay later" marketing feels similar to predatory loan companies. I don't know a whole lot about them and haven't used them personally, but they seem a little sketchy to me.

    1 vote
    1. imperialismus
      Link Parent
      Some of their services are basically consumer loans disguised as regular payments. But they also offer delayed, interest-free payments, which are very useful. For instance, when you order...

      Some of their services are basically consumer loans disguised as regular payments. But they also offer delayed, interest-free payments, which are very useful. For instance, when you order something off Wish and it takes a month to arrive from China, it's nice that the payment's not due until 45 days, and it's nice to be able to deal with a Western company in your own language if the product doesn't show up.

      2 votes