Published by Global Banking & Finance Review®
Posted on November 18, 2025
2 min readLast updated: January 20, 2026
Add as preferred source on GoogleKlarna partners with Elliott funds in a $6.5 billion loan deal to expand its buy-now-pay-later services in the US, enhancing its market presence.
By Pritam Biswas
(Reuters) -Klarna said on Tuesday it will sell up to $6.5 billion of loans to funds managed by Elliott Investment Management over a two-year period, as part of efforts to expand its buy-now-pay-later business in the U.S.
The agreement allows the Swedish fintech to sell a portion of its existing Fair Financing portfolio to Elliott funds and, from October, to transfer newly originated receivables to those funds on a rolling basis.
"This is another major step in our U.S. growth journey...This agreement lets us reach even more Americans who are moving on from traditional credit and choosing fairer ways to pay," Klarna Chief Financial Officer Niclas Neglén said in a statement.
The facility is sized at $1 billion, but as loans are repaid new ones will be added under a forward flow agreement, allowing Klarna to originate up to $6.5 billion of loans over two years.
"In its current growth phase, forward flow agreements are a capital efficient and highly scalable funding source that allows Klarna to execute fast and capture opportunities that present themselves as it is ramping its merchant base rapidly with its new payment service provider integrations," said Niklas Kammer, senior equity analyst at Morningstar.
Klarna will retain all consumer-facing functions, including underwriting and servicing.
A fair financing product allows BNPL customers to spread large-ticket purchases into fixed monthly installments over longer periods than short-term options, typically offering competitive interest rates and clear terms.
This product has become significantly popular in the U.S., with gross merchandise value growing by 244% in the country compared to a 139% global growth for Klarna, it said.
Klarna, among Europe's biggest fintech firms, also beat analysts' expectations for revenue in its first quarterly report since a blockbuster listing earlier this year.
(Reporting by Pritam Biswas in Bengaluru; Editing by Sriraj Kalluvila)
Buy-now-pay-later (BNPL) is a payment option that allows consumers to make purchases and pay for them in installments over time, often without interest if paid on time.
Consumer finance refers to the financial services and products available to individuals for personal use, including loans, credit cards, and mortgages.
A fintech company is a business that uses technology to provide financial services, such as payments, lending, and investment management, often aiming to improve efficiency and customer experience.
A forward flow agreement is a financial arrangement where a lender agrees to purchase a set amount of loans or receivables from a borrower over a specified period.
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