Klarna is seeking to offload credit risk tied to a portfolio of buy now, pay later loans through a new SRT (Significant Risk Transfer) transaction. The deal aims to free up capital as the Swedish fintech accelerates its international expansion plans, with a particular focus on the US market.

By transferring risk associated with its BNPL portfolio, Klarna can reduce regulatory capital requirements and redeploy funds toward growth initiatives. This strategic move comes as the company navigates a shifting regulatory landscape and increasing competition in the consumer credit space.

The SRT structure allows Klarna to maintain origination capabilities while distributing credit exposure to investors. This approach has become increasingly common among fintech lenders seeking to optimize balance sheets without sacrificing market share.

Analysts view the transaction as a signal of Klarna's confidence in its underwriting standards and its commitment to scaling US operations despite broader economic uncertainty.