Klarna - "boost your mood" with some debt
Discussion
https://www.theguardian.com/money/2020/dec/23/uk-w...
Probably right that the ad was banned but a shame that it's the ASA taking action on this not the FCA or ombudsman.
Probably right that the ad was banned but a shame that it's the ASA taking action on this not the FCA or ombudsman.
There is an FCA investigation expected to report sometime 2021
https://www.thetimes.co.uk/article/klarna-in-spotl...
https://www.thetimes.co.uk/article/klarna-in-spotl...
DonkeyApple said:
Nothing quite like spending money you haven't got to make you feel happier about not having any money as a solution. It's up there with itching your piles with a Stanley knife as common sense solutions go. 
They were described as the new Wonga. Was that a reasonable comment or hyperbole? I'm seeing more and more adverts for this style of finance, all squarely aimed at the sort of small non-essential purchases you should really be making with pocket money! I'd go as far to say it's potentially more dangerous than chunkier loan agreements as the amounts are so small it must be easy to fall into using it to pay for a new dress, a pair of shoes, a takeaway, and the whole lot building up into an unmanageable level.
I've no doubt we're seeing the next mis-selling scandal forming.
I've no doubt we're seeing the next mis-selling scandal forming.
WonkeyDonkey said:
All stems down to a massive under education in personal finances at a young age.
Very true but also we have to accept that it is human nature to over spend. It always has been which is why lending has always been regulated by some mechanism whether it be violence and fear, religion or regulation. But in 1997 we as a country removed all the last regulation that existed to prevent the lending of money beyond prudent levels and to individuals for whom excess debt would easily impoverish. The reason? It synthesises wage inflation to allow people to easily borrow and it creates an economic boom. Debt is good when permitted prudently and with care and respect. It gives people mobility and flexibility. But since the dawn of time we have known and fully understood the insidious nature of excess lending. That it drives poverty, creates massive wealth divides and ultimately leads to even people with good wages having no wealth.
All of these things such as Klarna are insidious, evil debt. They offer no viable benefit to anyone other than the few who naturally benefit from the many overspending.
When I ordered my new Boardman bike in the summer, I was offered 0% finance on Klarna.
Seemed like a great idea - I'd bought a TT bike about a year ago using the same kind of deal.
We're not talking huge amounts - the Boardman road bike was a grand.
Klarna turned me down! - I have no debts, own 2 houses outright, no car loans etc.
Ended up doing the PayPal 4 month interest free instead.
Seemed like a great idea - I'd bought a TT bike about a year ago using the same kind of deal.
We're not talking huge amounts - the Boardman road bike was a grand.
Klarna turned me down! - I have no debts, own 2 houses outright, no car loans etc.
Ended up doing the PayPal 4 month interest free instead.
Landcrab_Six said:
When I ordered my new Boardman bike in the summer, I was offered 0% finance on Klarna.
Seemed like a great idea - I'd bought a TT bike about a year ago using the same kind of deal.
We're not talking huge amounts - the Boardman road bike was a grand.
Klarna turned me down! - I have no debts, own 2 houses outright, no car loans etc.
Ended up doing the PayPal 4 month interest free instead.
Sounds like their algorithm has got smart enough to weed out those who will opportunistically take 0% finance but are solvent enough to avoid paying a penny in interest Seemed like a great idea - I'd bought a TT bike about a year ago using the same kind of deal.
We're not talking huge amounts - the Boardman road bike was a grand.
Klarna turned me down! - I have no debts, own 2 houses outright, no car loans etc.
Ended up doing the PayPal 4 month interest free instead.
Terminator X said:
How have they managed to conjure up $10bn worth if "The Swedish firm has taken online shopping by storm over the past couple of years and its model, which allows staggered payments for products with no fees or interest, has proved popular among millennials."?
TX.
Like a lot of venture capital-backed companies they are loss making now but will make it up in volume TX.
The retailer pays the interest (like all zero deals the actual cost of the debt is hidden in the product price) and then by waiving other aspects they can swerve some consumer debt regulation that makes it much easier to lend to absolutely anyone regardless of whether they stand a chance of ever repaying. And then you get as many as possible to trip into technical 'default' and smash them to bits with charges and fees until they collapse or kill themselves because they can't take any more.
The business itself is yet another model that works via the deliberate mispricing of client risk to enable a rapid book building. Such businesses, like P2P etc will always eventually blow up but the key is to bank the billions before then and leave the liability on the pension funds that bought in to the business. Yay.
The business itself is yet another model that works via the deliberate mispricing of client risk to enable a rapid book building. Such businesses, like P2P etc will always eventually blow up but the key is to bank the billions before then and leave the liability on the pension funds that bought in to the business. Yay.
I dropped my iphone 6s down the bog. So, as you do, I replaced it with a 'pristine' 6sPlus from Music Magpie. But when I went to pay for it up popped this Klarna thing offering a 3 month payup of the same price to them instead.
So I did it.
And...?
Well, nothing really, except a small amount stayed a bit longer in my bank account than it might have done otherwise. I think this did 'boost my mood' a tiny tiny tiny tiny bit.
I'd use it again. A virtually pointless and completely harmless service - a bit like this post.
footnote: I fished the other one out the bog and tried to dry it out and a couple of days later it burst back into life! So I gave it to the wife to replace her 5s that she barely used anyway. This appeared to 'boost her mood' a tiny tiny tiny bit too, so double mood boost bubble Klarna!!!
So I did it.
And...?
Well, nothing really, except a small amount stayed a bit longer in my bank account than it might have done otherwise. I think this did 'boost my mood' a tiny tiny tiny tiny bit.
I'd use it again. A virtually pointless and completely harmless service - a bit like this post.
footnote: I fished the other one out the bog and tried to dry it out and a couple of days later it burst back into life! So I gave it to the wife to replace her 5s that she barely used anyway. This appeared to 'boost her mood' a tiny tiny tiny bit too, so double mood boost bubble Klarna!!!
Edited by Groat on Thursday 24th December 18:38
NickCQ said:
Landcrab_Six said:
When I ordered my new Boardman bike in the summer, I was offered 0% finance on Klarna.
Seemed like a great idea - I'd bought a TT bike about a year ago using the same kind of deal.
We're not talking huge amounts - the Boardman road bike was a grand.
Klarna turned me down! - I have no debts, own 2 houses outright, no car loans etc.
Ended up doing the PayPal 4 month interest free instead.
Sounds like their algorithm has got smart enough to weed out those who will opportunistically take 0% finance but are solvent enough to avoid paying a penny in interest Seemed like a great idea - I'd bought a TT bike about a year ago using the same kind of deal.
We're not talking huge amounts - the Boardman road bike was a grand.
Klarna turned me down! - I have no debts, own 2 houses outright, no car loans etc.
Ended up doing the PayPal 4 month interest free instead.
They've assumed (correctly) they won't earn a penny out of you.
DonkeyApple said:
The retailer pays the interest (like all zero deals the actual cost of the debt is hidden in the product price)
So people who pay outright are subsidising the klarna gang?I bought a new TV last month. Found the best price for it. Went through a cashback site and the retailer was also offering a £100 pre paid credit card. Then as others have mentioned up popped klarna at checkout. I've spread it across 12 months at zero additional cost to me.
Petrol Only said:
So people who pay outright are subsidising the klarna gang?
I bought a new TV last month. Found the best price for it. Went through a cashback site and the retailer was also offering a £100 pre paid credit card. Then as others have mentioned up popped klarna at checkout. I've spread it across 12 months at zero additional cost to me.
Does it have any credit score implications? I bought a new TV last month. Found the best price for it. Went through a cashback site and the retailer was also offering a £100 pre paid credit card. Then as others have mentioned up popped klarna at checkout. I've spread it across 12 months at zero additional cost to me.
Petrol Only said:
So people who pay outright are subsidising the klarna gang?
I bought a new TV last month. Found the best price for it. Went through a cashback site and the retailer was also offering a £100 pre paid credit card. Then as others have mentioned up popped klarna at checkout. I've spread it across 12 months at zero additional cost to me.
That's the other issue with all these zero deals and the like. Everyone is paying more than need to for goods and services. I bought a new TV last month. Found the best price for it. Went through a cashback site and the retailer was also offering a £100 pre paid credit card. Then as others have mentioned up popped klarna at checkout. I've spread it across 12 months at zero additional cost to me.
The thing about zero deals is that smart people can use them to their advantage but the products only exist because there aren't that many smart people. And even the smart can eventually get caught out. It's the same as clearing a credit card each month. Few people do which is why the mechanism works and is so lucrative.
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