Klarna passes one million merchants

Klarna‘s decision to highlight its one million merchant milestone is about more than scale.

Klarna passes one million merchants

It is an attempt to demonstrate that buy now, pay later and other flexible payment options are no longer confined to fashion, electronics or other discretionary retail categories.

Instead, the Swedish group is positioning itself as part of the infrastructure of routine consumer spending, from home repairs and furnishings to salon visits and gym memberships.

The figures are striking. Klarna says it expanded its merchant base by 47 per cent over the past year, adding 285,000 merchants in 2025 alone, including 115,000 in the final quarter.

That pace of growth suggests the company is still finding substantial room for distribution, despite a more mature and competitive payments market than the one in which it first rose to prominence.

Partnerships are driving wider checkout distribution

A significant part of this momentum appears to be coming from Klarna’s growing relationship with payment service providers.

These partnerships matter because they reduce integration friction for merchants.

Rather than negotiating directly with Klarna or undertaking lengthy technical work, businesses can increasingly access its payment methods through the providers they already use to manage online checkout.

That model gives Klarna a more efficient route to scale. It also reflects a broader trend in payments, where platform distribution is becoming as important as consumer brand recognition.

The easier a payment option is to activate, the faster it can spread across merchant networks, particularly among small and mid-sized businesses that may lack dedicated payments teams.

A shift beyond retail into lifestyle and service spending

Perhaps the most interesting detail in Klarna’s latest update is the emergence of Leisure, Sport and Hobby as its fastest-growing merchant category, up 91 per cent year on year in February 2026.

This points to a wider shift in how consumers are using flexible payments. Klarna is increasingly being embedded in categories linked to lifestyle, wellbeing and recurring personal spending, rather than purely one-off retail purchases.

That evolution could be commercially significant. High-frequency categories tend to create more repeat engagement, stronger brand familiarity and potentially more sustainable transaction flows.

If consumers begin to view Klarna less as a financing tool for larger purchases and more as a regular payments option for everyday budgeting, the company strengthens its claim to be part of ordinary money management rather than an occasional checkout add-on.

Scale now needs to translate into durable revenues

The next question is whether network expansion can be converted into lasting profitability and revenue resilience.

Klarna now operates across 26 markets and says its merchant base includes more than one million businesses. That breadth gives it considerable reach, but scale alone is not the same as durable economics.

Investors and industry observers will be watching to see whether Klarna can deepen usage within this vast merchant network, particularly in higher-intent and higher-frequency categories.

The company’s challenge is to turn merchant ubiquity into stronger transaction density, repeat consumer use and improved monetisation. Reaching one million merchants is a notable milestone.

Proving that this footprint can support the next stage of sustainable growth is the more consequential test.