On October 14, Klarna’s stock fell approximately 3% as a broader downturn hit buy now, pay later (BNPL) lenders. The decline was not driven by company-specific news. A hotter-than-expected inflation report pushed long-term Treasury yields higher, raising concerns about borrowing costs for lending firms.
Analysis suggests Klarna may be better insulated from rising rates than some competitors. It primarily funds its operations through low-cost consumer deposits, rather than relying heavily on securitizations that are more sensitive to market rates. Klarna’s stock decline was less severe than Affirm’s, whose shares fell 10%.