Finance
Klarna, nearing IPO, wins fintech partnership from Affirm
Sebastian Siemiatkowski, CEO of Klarna, speaking at a fintech event in London on Monday, April 4, 2022.
Chris Ratcliffe | Bloomberg via Getty Images
Swedish fintech firm Klarna will be the exclusive provider of buy now, pay later loans for Walmart, taking a coveted partnership away from rival Affirm, CNBC has learned.
Klarna, which just disclosed its intention to go public in the U.S., will provide loans to Walmart customers in stores and online through the retailer’s majority-owned fintech startup OnePay, according to people with knowledge of the situation who declined to be identified speaking about the partnership.
OnePay, which updated its brand name from One this month, will handle the user experience via its app, while Klarna will make underwriting decisions for loans ranging from 3 months to 36 months in length, and with annual interest rates from 10% to 36%, said the people.
The new product will be launched in the coming weeks and will be scaled to all Walmart channels by the holiday season, likely leaving it the retailer’s only buy now, pay later option by yearend.
The move heightens the rivalry between Affirm and Klarna, two of the world’s biggest BNPL players, just as Klarna is set to go public. Although both companies claim to offer a better alternative for borrowers than credit cards, Affirm is more U.S.-centric and has been public since 2021, while Klarna’s network is more global.
The deal comes at an opportune time for Klarna as it readies one of the year’s most highly-anticipated IPOs. After a dearth of big tech listings in the U.S. since 2021, the Klarna IPO will be a key test for the industry. It’s private market valuation has been a rollercoaster: It soared to $46 billion in 2021, then crashed by 85% the next year amid the broader decline of high-flying fintech firms.
CEO Sebastian Siemiatkowski has worked to improve Klarna’s prospects, including touting its use of generative AI to slash expenses and headcount. The company returned to profitability in 2023, and its valuation is now roughly $15 billion, according to analysts, nearly matching the public market value of Affirm.
For Affirm, the move is likely to be seen as a blow at a time when tech stocks are particularly vulnerable. Run by CEO Max Levchin, a PayPal co-founder, the company’s stock has surged and fallen since its 2021 IPO. The lender’s shares have dipped 18% this year.
Affirm executives frequently mention their partnerships with big merchants as a key driver of purchase volumes and customer acquisition. In November, Affirm chief revenue officer Wayne Pommen referred to Walmart and other tie-ups including those with Amazon, Shopify and Target as its “crown jewel partnerships.”
An Affirm spokesman declined to comment.
Everything app
The deal is no less consequential to Walmart’s OnePay, which has surged to a $2.5 billion pre-money valuation just two years after rolling out a suite of products to its customers.
The startup now has more than 3 million active customers and is generating revenue at an annual run rate of more than $200 million.
As part of its push to penetrate areas adjacent to its core business, Walmart executives have touted OnePay’s potential to become a one-stop shop for Americans underserved by traditional banks.
Walmart is the world’s largest retailer and says it has 255 million weekly customers, giving the startup — which is a separate company backed by Walmart and Ribbit Capital — a key advantage in acquiring new customers.
Last year, the Walmart-backed fintech began offering BNPL loans in the aisles and on checkout pages of Walmart, CNBC reported at the time. That led to speculation that it would ultimately displace Affirm, which had been the exclusive provider for BNPL loans for Walmart since 2019.
OnePay’s move to partner with Klarna rather than going it alone shows the company saw an advantage in going with a seasoned, at-scale provider versus using its own solution.
The Walmart logo is displayed outside their store near Bloomsburg.
Paul Weaver | Lightrocket | Getty Images
OnePay’s push into consumer lending is expected to accelerate its conversion of Walmart customers into fintech app users. Cash-strapped consumers are increasingly relying on loans to meet their needs, and the installment loan is seen as a wedge to also offer users the banking, savings and payments features that OnePay has already built.
Americans held a record $1.21 trillion in credit card debt in the fourth quarter of last year, about $441 billion higher than balances in 2021, according to Federal Reserve Bank of New York data.
Next up is likely a OnePay-branded credit card offered with the help of a new banking partner after Walmart successfully exited its partnership with Capital One.
“We’re looking forward to going down this new path where not only can they provide installment credit … but also revolving credit,” Walmart CFO John David Rainey told investors in June.
— CNBC’s MacKenzie Sigalos and Melissa Repko contributed to this report.
Ramsey Solutions financial expert George Kamel weighs in on Americans working past retirement age and provides advice for investors.
Retirement nest eggs and Social Security benefits are key sources of funds for many Americans as they live out their golden years in the state of their choosing.
A recently-released study from GOBankingRates looked at the financial runway that retirees would have in each state with Social Security benefits and $1.5 million socked away for retirement, finding West Virginia offered the most years before living costs would deplete their retirement savings.
The Mountain State ranked No. 1 with $1.5 million in retirement savings expected to sustain retirees there for a whopping 54 years while facing about $27,800 in living costs each year after Social Security benefits, according to the study.
The Social Security Administration (SSA) allows Americans to access their Social Security retirement benefits early starting at age 62, though payments “will be reduced a small percentage for each month before your full retirement age” if they do that, according to the SSA. One’s “full retirement age” depends on when a person was born.
SOCIAL SECURITY PAYMENTS TO INCREASE FOR PUBLIC PENSION RECIPIENTS
GOBankingRates said it used data from a slew of sources, including the Bureau of Labor Statistics, the SSA and Missouri Economic Research and Information Center, to determine its rankings of how states stack up in terms of the amount of time that Social Security and $1.5 million in retirement would last retirees residing in them.
Overall, the study indicated that those two sources of funds would provide different amounts of years of “financial security” for retirees in states across the country. States’ cost of living after Social Security ranged from $27,803 to $87,770 per year, it found.
401(K) BALANCES HIT SECOND HIGHEST ON RECORD: FIDELITY
GoBankingRates found the number of years that $1.5 million and Social Security would sustain retirees in each state was:
West Virginia: 54 years ($27,803 post-Social Security cost of living per year)
Charleston is the capital and largest city of the U.S. state of West Virginia. Slightly processed using HDR technique (iStock / iStock)
Kansas: 52 years ($28,945 post-Social Security cost of living per year)
Mississippi: 51 years ($29,426 post-Social Security cost of living per year)
Oklahoma: 51 years ($29,666 post-Social Security cost of living per year)
Alabama: 50 years ($30,207 post-Social Security cost of living per year)
Missouri: 50 years ($30,327 post-Social Security cost of living per year)
Arkansas: 49 years ($30,237 post-Social Security cost of living per year)
Tennessee: 49 years ($30,928 post-Social Security cost of living per year)
Iowa: 48 years ($31,168 post-Social Security cost of living per year)
Indiana: 47 years ($31,709 post-Social Security cost of living per year)
Aerial view of Indianapolis downtown with Statehouse in Indiana (iStock / iStock)
Georgia: 47 years ($31,829 post-Social Security cost of living per year)
North Dakota: 47 years ($32,190 post-Social Security cost of living per year)
Michigan: 46 years ($32,310 post-Social Security cost of living per year)
South Dakota: 46 years ($32,310 post-Social Security cost of living per year)
Texas: 46 years ($32,490 post-Social Security cost of living per year)
Nebraska: 46 years ($32,610 post-Social Security cost of living per year)
Kentucky: 46 years ($32,670 post-Social Security cost of living per year)
New Mexico: 46 years ($32,670 post-Social Security cost of living per year)
Louisiana: 45 years ($33,031 post-Social Security cost of living per year)
An aerial view of downtown Baton Rouge from the State Capitol building, looking towards the Mississippi bridge and river. (iStock / iStock)
Montana: 45 years ($33,331 post-Social Security cost of living per year)
Ohio: 44 years ($33,827 post-Social Security cost of living per year)
Pennsylvania: 44 years ($33,872 post-Social Security cost of living per year)
South Carolina: 44 years ($34,052 post-Social Security cost of living per year)
Minnesota: 44 years ($34,113 post-Social Security cost of living per year)
Wyoming: 44 years ($34,173 post-Social Security cost of living per year)
Illinois: 44 years ($34,233 post-Social Security cost of living per year)
North Carolina: 42 years ($35,495 post-Social Security cost of living per year)
Downtown Raleigh, North Carolina, USA Drone Skyline Aerial. (iStock / iStock)
Maryland: 41 years ($36,276 post-Social Security cost of living per year)
Wisconsin: 41 years ($36,516 post-Social Security cost of living per year)
Nevada: 41 years ($26,997 post-Social Security cost of living per year)
Delaware: 40 years ($37,057 post-Social Security cost of living per year)
Virginia: 40 years ($37,237 post-Social Security cost of living per year)
Idaho: 39 years ($38,379 post-Social Security cost of living per year)
Florida: 39 years ($38,379 post-Social Security cost of living per year)
WalletHub published a report on Monday that found the best U.S. states to retire in 2022. Florida was at the top of the list. Tallahassee, Florida, is pictured. (iStock)
Colorado: 39 years ($38,559 post-Social Security cost of living per year)
Utah: 35 years ($42,645 post-Social Security cost of living per year)
Oregon: 35 years ($42,945 post-Social Security cost of living per year)
New Hampshire: 34 years ($43,847 post-Social Security cost of living per year)
Connecticut: 34 years ($43,967 post-Social Security cost of living per year)
Rhode Island: 34 years ($44,387 post-Social Security cost of living per year)
Arizona: 34 years ($44,628 post-Social Security cost of living per year
Maine: 33 years ($45,048 post-Social Security cost of living per year)
Washington: 33 years ($45,108 post-Social Security cost of living per year)
Vermont: 33 years ($45,409 post-Social Security cost of living per year)
New Jersey: 33 years ($45,829 post-Social Security cost of living per year)
The capital statehouse of New Jersey lights up as the sun sets the Delaware River in the background city of Trenton (iStock)
Alaska: 29 years ($50,997 post-Social Security cost of living per year)
New York: 29 years ($50,997 post-Social Security cost of living per year)
California: 24 years ($63,795 post-Social Security cost of living per year)
Massachusetts: 23 years ($65,117 post-Social Security cost of living per year)
Hawaii: 17 years ($87,770 post-Social Security cost of living per year)
THIS MIDWESTERN STATE IS CONSIDERED ONE OF THE BEST PLACES TO RETIRE, NEW STUDY SAYS: SEE THE LIST
Traders work on the floor of the New York Stock Exchange during morning trading on March 14, 2025 in New York City.
Michael M. Santiago | Getty Images
The market sell-off is not over yet as consumer and corporate confidence take a dive on tariff uncertainty, according to Deutsche Bank.
“We see the selloff in US equities as having further to go,” Binky Chadha, chief strategist at Deutsche Bank, wrote Saturday. “With trade policy uncertainty likely to continue to weigh, at least until April 2, we expect positioning to continue to unwind.”
“A move to the bottom of the positioning band which is where it went to in the last trade war, would take the S&P 500 down to 5250,” Chadha added.
The S&P 500 level highlighted by Chadha points to another 6.9% decline from Friday’s close of 5,638.94. The benchmark was last about 8% below the all-time high it reached just last month.
S&P 500
At the center of the strategist’s call are concerns of an economic slowdown amid tariff uncertainty that are unlikely to abate for at least the next several weeks. The latest earnings season showed CEOs are slashing capital expenditures and cutting their earnings forecasts.
Chadha also expects the idea of a “Trump put” — in which the president will ease on his policies that have destabilized the market — will not be realized until a marked turn lower in Trump’s approval ratings.
“Compared to the level of consumer confidence, the current approval rating is high, implying plenty of room for downside with negative growth or inflation developments likely to speed the catch down,” Chadha wrote. “We expect the net approval rating has to turn more significantly negative, at least -5%, before the administration starts to consider responding.”
Still, Chadha — who held one of the more bullish outlooks heading into 2025 — said that it’s “too early to throw in the towel” on his year-end target of 7,000, a move that’s more than 24% higher from Friday’s close. He thinks stocks can bounce back sharply in the latter part of the year if there’s a resolution on tariff uncertainty.
On Monday, at least, the broad index rose slightly as it tries to claw back its recent losses. The move came after the latest U.S. retail sales report showed consumers are still spending though at a slower pace than expected.
“While the risks have grown, for now we maintain our year-end S&P 500 target of 7000,” he said.
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