Using a service like Klarna means you're bad at dealing with money, so it makes sense.
1. The chance, weighted by amount, of a price hike/salary increase
2. The chance, weighted by amount, of a price decline/salary decrease.
As inflation is generally an upward trend, clearly no. 1 is more likely and thus the best bet.
Also someone may have some assets they could turn into liquid cash if I really needed to but may not have a lot of liquid cash on hand, so there would be little risk in paying something in installments as long as their assets would be enough to cover it in a pinch.
I am not sure it actually applies to the cost of a phone. Chances are, if those matter, you'd be better off with a cheaper phone to begin with. (Substitute phone with other luxury articles).
So how do they make money? Sounds like they would be losing money to inflation by offering that service for free.
Generally the logic on "free" financing by the seller is that without it, they may have not made a sale at all. Sure it cuts into their margins, but offering rebates would have had a similar effect.
Klarna probably still charges the vendor a few bucks for handling the thing.
My bank just scraped virtual cards and I use them for online payments so I wanted to use Klarna as a virtual card. Went through the whole process only for it to fail at the end with Klarna saying that they can’t generate that card, but I should go talk to Schufa or Arvato about it.
So, not all use cases are bad and Schufa should distinguish between them.
They probably make their money from the seller who banks on the fact that people would be reassured of being able to afford the high priced item, and thus be making more sells than otherwise.