Klarna has secured approval to offer credit and payments products in the UK ahead of the expiration of a temporary deal arranged in the wake of Brexit.
The Financial Conduct Authority has authorised the Swedish-based firm to provide the term loans and card products it offers in the UK.
Following Brexit, Klarna Bank, a fully licensed Swedish bank, continued to provide regulated services in the UK under the FCA’s Temporary Permissions Regime. The TPR was set to expire on 31 December.
The authorisation does not cover Klarna's main buy now, pay later business, which is outside of the Consumer Credit Act's scope.
Klarna says it has "long argued that they should be regulated to protect consumers from bad actors, while continuing to have access to low cost credit".
"As well as enabling us to continue to provide our regulated products, the FCA approval puts Klarna’s successful UK business on a secure regulatory footing ahead of the expected regulation of BNPL,” says Abby Vickers, head of the newly created Klarna Financial Services UK.