Buy Now, Pay Later (BNPL) FinTech Klarna has launched a new feature which enables consumers in the UK to pay in full, as well as a number of changes designed to give customers more “clarity and control” over how they pay.

The company has introduced stronger credit and affordability checks, clear checkout language, simplified terms and conditions, improved complaints handling, and the removal of last remaining late fees.

The move comes as Klarna and the wider BNPL market face criticism over UK consumers, particularly from younger demographics, racking up debts when using the flexible payment option.

Klarna said that these changes, unveiled ahead of UK Treasury plans to set out new rules for the market, aim to “drive up standards” across the UK payment industry.

Via the company’s Open Banking services, currently connecting 6,000 banks across 20 countries, consumers will now be able to share income and spending data from their bank accounts to confirm they can afford future payments.

Additionally, Klarna has established its own complaints adjudicator for consumers who remain dissatisfied with how their complaint against Klarna has been handled. Klarna took this measure after being informed by the Financial Ombudsman Service (FOS) that complaints about BNPL products currently could not be referred to FOS on a voluntary jurisdiction basis.

From today, Klarna will now also remove any remaining late fees, which consumers use to spread the cost of higher value purchases over 6 - 36 months.

“We firmly believe that most of the time, people should pay with the money they have, but there are certain times where credit makes sense,” said Sebastian Siemiatkowski, Klarna’s co-founder and chief executive. “In those cases, our BNPL products offer a sustainable and no cost healthy form of credit - and a much needed alternative to high cost credit cards. The changes we are announcing today mean that consumers are fully in control of their payments whether they pay now or pay later.”

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