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Klarna pledges to be transparent about customer debt as she reflects on public announcement


Klarna’s boss has pledged to release figures on the number of UK clients referred to debt collection agencies by his company as she considers a possible public listing.

Speaking to the PA news agency, the boss of the later now-pay buyout, Sebastian Siemiatkowski, said it would reflect recent disclosures the company had made in his native Sweden.

He also said that potential rule changes designed to encourage companies to list in the UK, which would allow founders to maintain better control under dual-class structures, could make the London Stock Exchange more attractive to Klarna.

“At least for me as a co-founder, the idea of ​​being able to have double classes is obviously an idea that I know a lot of companies and founders care about,” Mr. Siemiatkowski said.

Relaxing the rules about the number of shares that must be sold when a company is listed in London – something called free float – could prompt the company to choose a UK listing.

The traditional way to trust is to put a white man in a marble office in a suit and then try to appear very complex and difficult to understand.

Sebastien Siemiatkowski

Yet while an initial public offering (IPO) may be “the natural next step for the business”, it is not imminent. And other places could be chosen, including the United States.

“We’re not doing it right now, but it’s not like it’s unthinkable that this will happen within a year or two.”

If listed, Klarna will likely face questions about his future as UK authorities appear poised to introduce more stringent regulations in his industry.

In an effort to allay fears in Sweden, Klarna released a wealth of data two weeks ago, including trends in the recalls she sent to clients and the number of clients who were referred to the official collection agency. debt of the country.

The data also disaggregated debt collection referrals by age group, showing that men aged 18 to 25 were the most likely to be referred to debt collectors.

Mr Siemiatkowski said Klarna wanted to release the same information in the UK

“We have this ambition, it’s just a work in progress,” he said.

“This level of transparency is what builds trust.

“The traditional way to trust is to put a white man in a marble office in a suit and then try to look very complex and hard to understand,” said the boss wearing a t-shirt from his bedroom. hotel in London where he was in quarantine. after arriving from abroad.

Klarna allows customers to purchase items from any of its partner websites, including ASOS and Gymshark, but wait 30 days before paying.

The company does not charge customers any interest for this and customers are not subject to late fees. Instead, the business makes money by taking a share of the retailer’s stock.

Although of no interest, consumer champions Citizens Advice have warned that such programs can be a “slippery slope to debt.”

Mr Siemiatkowski said he supported the regulation, but said there were “a lot of misconceptions” in the UK, including comparisons with payday lenders, which he said were the fault of the company for not having communicated well enough.

He called for “results-based regulation” that favors the best types of credit – like Klarna, he said – over the worst forms, including credit cards.

The regulation in favor of Mr. Siemiatkowski would examine the number of customers who go into debt and the cost of credit.

“What you need is both competition and consumer protection. And that can be accomplished by not being restrictive and saying, you have to ask this question or do this and that, but saying that your losses cannot be greater than that, or the number of people going into debt. or your prices cannot be higher. expensive than that, ”he said.

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