Klarna vs. Affirm for US Businesses: Choosing the Right Payment Partner

Buy Now, Pay Later (BNPL) solutions can help businesses increase sales and improve customer conversion rates. Klarna and Affirm are two of the leading BNPL providers available to US businesses.

Choosing the right partner depends on your business model, average transaction value, and customer base. This guide compares Klarna vs. Affirm to help you decide which is a better fit for your company. We'll also discuss the Wise Business account. The global account that can help your company with all things cross-border.

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Klarna vs. Affirm for Business: Quick Overview

Klarna vs. Affirm: Key Features

Both Klarna and Affirm allow businesses to offer customers point-of-sale financing. The merchant receives the full payment up front (minus fees), while the provider manages the customer's payment collection.

Klarna: Key Products

Klarna provides a suite of payment options designed to give consumers flexibility. For businesses, this translates into different ways to convert a shopper into a customer.

• Pay in 4: This is Klarna’s most common interest-free option, allowing customers to split a purchase into four equal payments made every two weeks.⁷ This is ideal for smaller everyday purchases.
• Pay in 30: Customers can receive their goods and pay the full amount up to 30 days later, also without interest.⁷
• Financing: For larger purchases, Klarna offers traditional financing that spreads payments over 6 to 24 months. This option may include interest for the consumer.⁷

Klarna also functions as a marketing channel through its app, potentially driving new customers to partner merchants.

Affirm: Key Products

Affirm focuses primarily on simple, transparent installment loans. Its model is built around clarity for the consumer, with no hidden fees.

• Installment Loans: Affirm allows customers to pay over a set period, such as 3, 6, or 12 months, or even longer for very large purchases.¹
• No Late Fees: Affirm does not charge late fees, which can be an attractive feature for customers.¹
• Interest-based and Interest-free: While many loans accrue interest, Affirm merchants can sponsor interest-free promotions for their customers. The total interest a customer will pay is shown up front.^{1, 8}

Klarna vs. Affirm Fees

For businesses, the primary cost of offering BNPL is the merchant discount rate. This is the fee you pay on each transaction. Both Klarna and Affirm use a similar fee structure.

Klarna Fees for Businesses

Klarna charges merchants a per-transaction fee. This typically includes:

• A fixed fee of around $0.30 per transaction²
• A variable percentage ranging from 3.29% to 5.99%²

For example, on a $100 sale, a business might pay between $3.59 and $6.29. The exact rate depends on the payment plan chosen by the customer, the merchant's sales volume, and the business's industry.

Affirm Fees for Businesses

Affirm's fee structure is also a combination of a fixed fee and a percentage of the sale. The specific rates are determined during the merchant onboarding process.³

Because Affirm often finances larger purchases with longer terms, the impact on a business's margin needs careful calculation. For a $1,500 furniture sale, a 6% fee would be $90. The business must weigh this cost against the likelihood of securing a sale that might not have happened otherwise.

International Fees

Neither Klarna nor Affirm is primarily designed for cross-border business-to-business (B2B) payments. Their models are focused on consumer point-of-sale financing within specific regions.

If your business pays international suppliers or contractors, you face different costs. Traditional bank wires for international payments often include high transfer fees and poor exchange rates, which can significantly increase operational overhead. A 25-person agency paying 12 international contractors monthly could lose a substantial amount to hidden currency conversion fees.

Klarna vs. Affirm: Differences in Product Offerings

The main difference between Klarna and Affirm is their core product focus and target purchase type.

Klarna positions itself as an "all-in-one" shopping service. It offers multiple, flexible, short-term payment options ideal for everyday e-commerce, such as fashion, cosmetics, and accessories. Its "Pay in 4" plan encourages smaller, more frequent purchases. Klarna's marketing features and shopping app also provide a customer acquisition channel that Affirm does not.²

Affirm specializes in being a straightforward financing solution for larger, more planned purchases. Its strength lies in simple longer-term installment loans for things like mattresses, electronics, and travel.² Businesses that sell high-value goods may find Affirm's longer loan terms (up to 60 months) better suited for making expensive products seem more affordable to customers.⁴

Save Time and Hassle With Wise Business

Wise is not a bank, but a Money Services Business (MSB) provider and a smart alternative to banks. Wise makes it easy to send, hold, and manage business funds in currencies. You can get major currency account details for a one-off fee to receive overseas payments like a local. Simply add the local account details when billing international customers to receive international payments with no fees.

Account opening is 100% online, with no need to visit a branch or book appointments.

Once you’re set up, you can connect to software such as Wave, FreshBooks, and more. You can also withdraw funds from Stripe without currency conversion fees.

Open a Wise Business account online