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Comment by kristofferR | Hacker News Reader

I don't agree, I think Klarna is awesome.

Klarna BNPL is like a CC, good for those who can handle it. It doubles your credit period (so you get 30 days Klarna + 30 days Credit Card) for free, leading to higher returns if you believe you can handle credit profitably.

Not only that, but it's also quicker to pay with than CC (No 3DSecure) and you get all your ordered items in a usable list. Way more secure than giving my credit card information freely away to random webshops too. If you don't want BNPL you can pay right away through Klarna anyway, it's like Paypal in that regard.

They don't seem predatory at all to me TBH, if they were, they wouldn't have autopay and send you so many notifications if you don't have that enabled. They don't even charge me anything for semi-late payment of a few days late.

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So what about the people who can't handle it who are nevertheless offered it, can't pay and end up in lifetime debt? That's just the consequences of "not being able to handle credit?" A life sentence on the debt treadmill?

Well, yeah, I agree that debt sucks for those who can't handle it, but I'm not sure what your prescription to end credit/debt would be. It seems you are criticizing capitalism in itself more than Klarna specifically, Klarna seems way less predatory than most credit cards IMO.

We're all about making the world Safe these days.

If we can criminalize people saying mean things about minority groups, we should be able to stop lenders (and casinos...) from financially-exploiting the minority group of irresponsible debtors. We have to save all people from the consequences of their own decisions in the name of safety.

Klarna is nobody's first option and for bad debtors is more predatory than even my worst card. Late fees are charged per transaction. If you go on a buying spree and are late with your payments, you get the financial fucking of a lifetime in a mere matter of months. It's like having 12 credit cards and missing payments on all of them.

The individual late fee is lower than a credit card, but they make up for it by driving reckless purchasing.

It's wild to me that you went from:

> We have to save all people from the consequences of their own decisions in the name of safety.

To then go on to explain why Klarna is problematic:

> Klarna is nobody's first option and for bad debtors is more predatory than even my worst card. Late fees are charged per transaction. If you go on a buying spree and are late with your payments, you get the financial fucking of a lifetime in a mere matter of months. It's like having 12 credit cards and missing payments on all of them.

> The individual late fee is lower than a credit card, but they make up for it by driving reckless purchasing.

The "their own decisions" in your statement there is incredibly load bearing. Is it their decision? If you take someone with a blend of neurodivergence or even just lack of experience or education in financing, and present to them a way to get a thing they really want, today, with the click of a button, is that their decision? Does how informed they are about that decision, its ramifications, it's consequences matter?

If people received a broad and sensible financial education as part of K-12, I might agree with you, but they don't, at least not universally. I didn't know shit about credit cards when I turned old enough to apply for one, apart from "you had to pay it back," and "it's not free money," which like, no shit. Didn't stop me from filling it right up and ruining my credit score during college. I didn't know a fucking thing about interest, or how to read the financial statements, how one $2,000 laptop would end up costing me close to $5,500 later on.

And that's a credit card, which is at least some work to get. A Klarna financing arrangement doesn't take shit.

This kind of argument is so frustrating because it's always opposed by the same sort of person for whom the current setup works well, and it's like, hey man, that's great. Good for you. Look at all your agency, I'm proud of you for making all the right choices. But what about everyone else who didn't? Is everyone who's not as savvy as you deserving of a financial ass-fucking because they never got taught how interest works?

> how one $2,000 laptop would end up costing me close to $5,500 later on.

> And that's a credit card, which is at least some work to get. A Klarna financing arrangement doesn't take shit.

Eh, I don't think that is correct. Klarna US charges up to a 25% late fee before the debt is sent over to debt collectors, it doesn't accrue AFAIK. I'm pretty sure they do standard credit checks too.

> Look at all your agency, I'm proud of you for making all the right choices. But what about everyone else who didn't?

Well, this is a hard question. I don't believe in banning things that might be harmful if misused (and rewarding if used properly), regardless if it's alcohol or credit. I do however believe good education is incredibly important to avoid issues.

> Eh, I don't think that is correct. Klarna US charges up to a 25% late fee before the debt is sent over to debt collectors, it doesn't accrue AFAIK. I'm pretty sure they do standard credit checks too.

I'm talking about a credit card. I am old: there was no Klarna when I came up, and thank fuck, I did a good enough job screwing myself over financially without shit like that at my fingertips.

> Well, this is a hard question. I don't believe in banning things that might be harmful if misused (and rewarding if used properly), regardless if it's alcohol or credit. I do however believe good education is incredibly important to avoid issues.

I mean that's the thing: at least a credit card is, maybe not hard, but a nonzero amount of work to get. And they confer some benefits: It raises your overall borrowing power, which makes your credit score go up; there are usually some benefits or others attached, things like cash back, or points rewards systems; they're damn handy for life's little emergencies where you need a sizable hunk of money right now, etc.

In contrast, there is no benefit to a BNPL arrangement apart from getting the thing sooner, and, those arrangements are going to be the most attractive to the people who are most likely to live in financial precarity; if you didn't, you'd just buy the thing, whatever it might be, with cash or credit. They are marketed exactly to the people they are most likely to fuck over. And I refuse to believe that's an accident.

I don't think we should or even can ban everything that can be harmful if misused. I just think it's advantageous as a society, even a free market society, to ban things that are blatantly exploitative of more vulnerable people, that otherwise confer little to no benefits to the larger society. Were I dictator for a day, I wouldn't ban credit. I would ban exploitative, predatory credit models, and mandate proper education on how to make use of non-predatory (well, less predatory?) credit models.

> In contrast, there is no benefit to a BNPL arrangement

I listed a ton of benefits of BNPL apps like Klarna in my parent comment, and I'm someone who could pay for everything with debit if I wanted. I really like using Klarna, and when I can choose between giving a web shop my CC info or paying with Klarna I always pay with Klarna.

If they were blatantly exploitative like payday loans I would agree with you, but I don't agree that it is. I think it is way less exploitative than credit cards, where debt can accrue manyfold, as per your own example.

> We're all about making the world Safe these days.

There's a cost to that.

I find nannying by companies or the government to be incredibly insulting.

Personally I believe trying to protect people from themselves is harmful - you can't win that game.

That's like saying gambling companies aren't predatory because personally I only bet on sports every once in a while and never more than I can afford to lose.

Can you pay Klarna with a rewards credit card? I notice Capital One doesn’t support them for some reason.

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