How Klarna Payment Makes Its Impact On Shopify Merchants

Klarna in recent years has significantly helped Shopify merchants increase sales, expand customer reach, and improve customer satisfaction with its Buy Now, Pay Later (BNPL) service. However, integrating Klarna involves considerations such as fees, integration complexity, and potential customer service challenges. Therefore, choosing Klarna should align with a merchant's overall business strategy and target audience.

The Proven Popularity Of Klarna

Klarna is one of the most popular payment gateways offering various helpful payment options to 150 million users daily.

According to Klarna, as of the end of 2022, the company has over 2.5 million daily transactions, made by 150 million users across 45 countries, and via 550.000 merchants. With this impressive number, Klarna has become one of the most popular payment gateway providers in the world in general, and the most trusted Shopify payment gateway provider in general. By offering flexible payment options, merchants can attract a wider customer base and potentially increase average order value.

There is a researched number of Klarna that you must put into consideration, that is the report from HelpCenter in 2021, in which Klarna holds 53% share of the global market, proving the top position of the company, and also the trustworthiness of it in customers’ minds. Detailed information about Klarna’s impacts on the revenue of online businesses is provided in the section below.

Klarna's Positive Impact on Shopify Merchants

As a long-time partner of Shopify, Klarna has brought a good payment experience to many of its merchants and their customers, enhancing the shopping experience and driving sales on the platform. Particularly, below are the impacts Klarna has done to gain the hearts of its partners:

• Improve sales and conversion rates: Klarna offers the powerful Buy Now, Pay Later (BNPL) payment option that allows customers to spread the payment of their purchase over time, making high-cost purchases more possible for the buyers and increasing business revenue. Not to mention the option also decreases the cart abandonment rate with quick and easy payments.
• Enhance customer experience: Klarna’s other highlighted features are providing multiple payment options, multi-currency acceptance features, and a friendly and customizable interface, which have helped Klarna contribute to merchants' positive customer experience and possibly led to attracting a group of customers.
• Guarantee high data protection: Klarna ensures merchants receive full payments and are present in time to check and fix any payment issues, even if customers delay or default on payments.
• Increase in Average Order Value (AOV): Klarna's BNPL options often encourage customers to spend more than they might have with traditional payment methods.

As one of the most trusted payment solution providers in the world, merchants on Shopify are given several benefits as mentioned above in addition to a seamless payment experience. Indeed, Klarna’s BNPL services play the main point in bringing satisfaction to most online businesses and their customers. But, what is BNPL, and how is Klarna’s BNPL work to benefit its merchant partners? Let’s find out in the section below.

Klarna's famous friendly user interface helps to enhance the payment experience on-site.

How Does Klarna’s Buy Now - Pay Later Work?

Klarna is a popular BNPL service provider that offers several different payment options in the form of the service, two of which are mentioned as follows:

Pay in 4

“Pay in 4” is a type of BNPL payment method that allows customers to split their purchase into four equal payments. Typically, the method has these characteristics:

• The purchase will be divided into four equal periods of payment and no longer than 6 weeks from the first payment.
• The first payment is due at checkout.
• The remaining payments are automatically deducted every two weeks.
• No interest or fees if the payments are made on time.

While with “Pay in 4”, customers are provided with a longer time to manage their payments, the “Pay in 30 days” method has the flexibility that allows them to pay whenever they are ready within 30 days.

Pay in 30 Days

The “Pay in 30 days” payment method is another type of BNPL that allows customers to complete their purchase at any time within 30 days.

• Get your order first, and pay later.
• You have 30 days to pay the full amount.
• No interest or fees if the payments are made on time.

Important to note: While Klarna offers interest-free options to its BNPL payment methods, late fees may apply if you miss a payment. Additionally, overusing BNPL services can impact your credit score.

Shop and pay with more joy and convenience with Klarna.

Set Up Klarna On Shopify / Add Klarna To Your Shopify Store

Since Klarna is one of the most popular payment methods on Shopify, the need for integrating the app into your store is high. Below are step-by-step instructions on how to add Klarna as your payment method:

• 1. Install the Klarna merchant account on Shopify

Sign up for a merchant account on the Klarna website.

Go to your Shopify merchant account and search for Klarna in the Shopify App Store.

Install the Klarna Payments app.

• 2. Connect Klarna to your Shopify store

Once Klarna is installed, follow the instructions from the app to link your merchant account to Klarna.

Choose the payment option you want and customize the appearance and messaging of Klarna payment buttons.

• 3. Launch the trial use of the Klarna payment

Place a test order to ensure Klarna works with your merchant account finely and smoothly.

Make sure you turn off the test mode after finishing the test order.

That is how merchants integrate the Klarna app into their payment system on the Shopify store.

Klarna currently has the most popular payment gateway solution provider with approximately 150 million users all over the world.

Though being widely used on Shopify, Klarna is only available in 45 countries and has limited features compared to others. PayCEC, however, is an ideal payment option for online stores wishing to reach international markets with a huge group of users from more than 99 countries and borders in the world.

PayCEC - A New And Innovative Payment Option For Online Businesses Aiming At The Global Market

PayCEC is one of the most popular online sites famous for its seamless payment services and the fast 24-hour integration feature that allows merchant partners to assist their customers in receiving and sending payments immediately within 24 hours.

One more important feature that PayCEC offers to its merchants is customer insight and analytics. PayCEC, with the permission of businesses and their customers, has their customer data securely stored and updated for better their customers in the future, saving time and effort submitting payment data over again, and collecting insightful information on user behavior and preferences, enabling data-driven decisions.

More importantly, with the official launch in over 99 countries all over the world, PayCEC can help business partners go closer to their strategy to thrive in the global market, compared to Klarna with 45 countries. Making their purpose to go further and faster to the largest market of the world come true.

About PayCEC

PayCEC was established in response to the growing need for businesses to accept online payments more quickly and easily. In the new media era, our payment flow has evolved to work seamlessly and effectively across all platforms and devices. We pride ourselves on combining superior technology with first-class customer service.

PayCEC is a truly global payment platform that not only allows customers to get paid but also withdraw funds to their business accounts in various currencies. We have created an open and secure payments ecosystem that people and businesses choose to securely transact with each other online and on mobile devices.

PayCEC Team

• [email protected]
• +65 6631 8332
• www.paycec.com