So, how does Klarna work?
There are two ways to use Klarna. You can take Klarna’s pay in 4 option to any store by downloading and shopping directly through our app, in-store and online. Or, simply go to the retailers we're currently partnered with and pay with Klarna at checkout.
Pay later shopping.
Millions of people have already discovered the benefits of online shopping with payment plans. Pay over time, no matter what you need, we’ve got flexible payment options to fit your budget.
Split the cost of your purchase into 4 payments, over 6 weeks. No interest. No catch. Just more time to pay for the things you love.
Pay in 4 with zero interest. Online and in-store, all in the Klarna app
Get the free Klarna app on your phone:
Klarna Pay Later in 4 Instalments Terms
How it works
Use your own valid debit or credit card to pay (no prepaid cards).
You must be 18 years old and capable of entering into a legally binding contract.
The first payment is charged when the merchant confirms your order (usually the shipping date), the next 3 payments are automatically charged every 2 weeks after that.
There are no interest charges with Pay later in 4 instalments, and no fees when you follow your automatic payment schedule. If you are delayed in making a payment, we may charge you a late fee as disclosed in the Schedule of Fees below. Any missed instalments, including any added late fees, will be rolled over to the next scheduled Due Date.
If you cancel your purchase or return your goods we will automatically waive the amount you owe us (as soon as this has been confirmed by the merchant). If you already paid us for a refunded order, we will refund the amount you paid back to you.
If you have questions about the quality or shipping of your order, please contact the merchant where you made the purchase.
The issuer of your card may charge interest or fees under your agreement with them. If you have any questions about those charges contact your card issuer.
The following payment option terms (“Payment Option Terms”) apply between Klarna Australia Pty Ltd ("Klarna," we," or "us") and the user of this payment option ("you"). In addition to these Payment Option Terms, your use of the Klarna Services are governed by the Klarna Services Terms and the Klarna
Please read these Payment Option Terms carefully. If you do not agree to these terms, you must not use the Klarna Services.
If you are offered to Pay later in 4 instalments, you have the option to pay for your purchase with a credit or debit card in four (4) payments. You will make your payments directly to Klarna using your card. There is no cost to use this service, however the issuer of your card may charge interest or other fees under the terms of your card agreement. It is at our discretion whether you can pay with this Payment Option.
Accepted Cards: We may limit the types of cards we accept at our discretion. If a type of card is not accepted you will be notified before the purchase is completed. Most valid credit and debit cards that are not scheduled to expire in the near future are accepted. We do not accept prepaid cards. If we accept a card we will authorize the card for the Initial Payment. This amount will not be charged until the merchant confirms the order, but your card issuer may restrict access to the authorized amount while pending.
Payment Schedule and Due Date: When you elect to use this payment option, we will present you with the applicable payment terms, including:
The amount of your Initial Payment.
The amount of each subsequent Instalment Payment.
When using Pay later in 4 instalments, your Initial Payment will be charged once your order is confirmed by the merchant. This typically occurs when the merchant ships the goods but could also happen at the time of order placement. Three (3) subsequent Instalment Payments will be due every 14 days after the first payment is charged to your card. Future payments are automatically charged to your card on the Due Date.
In the event the merchant does not charge for your entire order at the same time, we will create a separate Pay later in 4 instalments order for each merchant charge. Each of these order parts will have its own Due Date depending on when the merchant confirms that part of your order. This situation may be common where a merchant does not ship all the items from your order at the same time, and makes a new charge for each shipment.
You can pay any remaining Instalment Payments at any time before the Due Date and we will not charge you for doing so.
If you cancel your purchase, and the merchant confirms this to us, we will cancel any remaining payments and pay back to your card any amounts we have already charged to your card.
Late Payment: If we are unable to charge your selected payment method for the amount due on your Due Date we will send you a notification and provide you a courtesy two to seven business day slack period so that you can update your payment method or ensure enough funds are available on your selected card. If you update your card, we will attempt to collect the late payment immediately. Otherwise we will attempt to charge your original card again after the two to seven-day period. It is important that you ensure enough funds are available to complete your payment on the Due Date.
If you fail to make a payment by the end of the courtesy slack period you will be in default, and in addition to other right we have (see “Default” section below), we may charge you a late fee amounting to the following; i) zero (0) AUD per instalment if the total order value is below 24.99 AUD; ii) two (2) AUD per instalment if the total order value equals to 25 or above up to 59.99 AUD, iii) four (4) AUD per instalment if the total order equals 60 AUD or above up to 99.99 AUD, iv) six (6) AUD per instalment if the total order is of between 100 AUD and 199.99 AUD, or v) eight (8) AUD per instalment if the total order equals 200 AUD or above. If you fail to make your payments you may be unable to use the service in the future. We may continue to attempt to collect overdue and currently due payments on subsequent Due Dates, or invoice you separately for the unpaid total.
Schedule of Fees in AUD
Total order value
Late fee per instalment
Total late fees for four late instalments
0 - 24.99
25 - 59.99
60 - 99.99
100 - 199.99
Returns: Any returns or refunds credited to your purchase will reduce your outstanding balance. You will need to continue to make your previously disclosed Instalment Payments at scheduled Due Dates until your balance is paid in full. If you have a credit balance you authorize us to credit the balance back to your card, or any other card we have on file for you.
Default: You will be in default if you: (a) fail to make any payment by Due Date after any applicable slack period(s); (b) become the subject of insolvency or bankruptcy proceedings; (c) supply false, misleading, or incorrect information to us; or (d) violate or are unwilling to comply with any provision in the Payment
If you are in default Klarna may: (a) charge the outstanding balance, including late fees, on your Pay later in 4 instalments purchase immediately, using any card we have on file for you or by a separate invoice; (b) employ a debt collection agency to receive payment and you will have to pay all reasonable costs (including attorney’s fees) incurred by Klarna and/or the debt collection agency; and (c) report default information to credit reporting agencies.
Hardship: If you are unable to pay us on time and you find yourself in financial hardship, please contact us at email@example.com.
Dealing with our rights and obligations: We may assign or novate to any person or entity or otherwise deal in any manner with any of our rights, remedies, powers, duties, obligations or interests under this agreement and you consent to us assigning or novating this agreement, in particular, where we novate this agreement you consent to the assumption of liabilities under this agreement by the relevant new party and the release of obligations under this agreement of Klarna.
Credit Report Access, Identity check and Reporting: Klarna will verify your identity when you apply to utilize this Payment Option. Identity verification is done in order to comply with anti-money laundering and counter-terrorist financing requirements and to prevent fraud. You will have to provide Klarna with necessary information and documentation requested to verify your identity. We will also verify information you have provided against a third party database. When you apply for this Payment Option, we may order a credit report from a credit reporting agency or third party database who will supply us with credit information. The agencies will record details of the search, which can be seen on your credit file, whether or not credit is granted. This record will also be visible to third parties and may affect other organizations’ future decisions on whether or not to provide you with credit. We may also validate your card and request authorization from your card issuer. In this case there will be no entry shown on your credit file for these payments.
We may report information about your order to credit reporting agencies. Late payments, missed payments, or other defaults on your purchase may be reflected in your credit report and could impact your credit score.
Storing Card Details: You authorize Klarna to store your card details in our systems. We will use this information to authorize future charges under these Payment Option Terms. Unless you opt out, we may also use this information to conveniently prefill your card details for future purchases. You may manage your cards and details online. If your card details change between your initial purchase and final payment, you agree to notify Klarna of your updated card information. In the event Klarna obtains updated card information from the card issuer, you agree that we may use this updated information in our system.
Debit Card Transactions: If you use a debit card, you authorize Klarna to initiate preauthorized transfers from the related account. The amount of each transfer is disclosed during the creation of your order. You agree we may initiate transactions in the amounts listed, or less, in the event that part of your order is returned or not fully captured. Your final payment schedule will be emailed to you, and available through the Klarna App, once the merchant confirms your order. If you would like to cancel preauthorized transfers from your account you may change your payment card or contact your financial institution. You agree these terms will serve as your copy of your authorization for Klarna to initiate preauthorized transfers. We will provide notice within two (2) days after each payment confirming that you have paid the amount listed in your payment schedule (or less, in the event part of the order is returned or not fully captured).
Our use of your personal information
Notices and communication
These Payment Option Terms, notices or other communication from Klarna will be provided to you electronically. Please contact firstname.lastname@example.org for any questions regarding notices and communication.
Klarna Australia Pty Ltd, ABN 82 635 912 579, Level 16, 175 Pitt Street, SYDNEY NSW 2000, Australia. Klarna Customer Service can be contacted through the contact form provided here.
If you have a complaint towards Klarna, you can submit your complaint through Klarna’s website (klarna.com/au/), via email at email@example.com or via postal mail with the keyword "Complaint” to: Klarna Australia Pty Ltd, Level 16, 175 Pitt Street, SYDNEY NSW 2000, Australia. More information can be found on https://www.klarna.com/au/customer-service/.
Upon receiving your complaint, we will provide you with acknowledgement within one (1) business day, or as soon as practical, and endeavour to resolve your complaint as soon as possible. In situations where the complexity of the issue may require more time and in-depth investigation, we will provide you with an initial response within ten (10) business days as per our commitments under the Australian Financial Industry Association (AFIA) Code of Practice.
If we are unable to resolve your complaint, you may refer your complaint to the Australian Financial Complaints Authority (AFCA). More information can be found on AFCA’s website: firstname.lastname@example.org. You may also contact AFCA via phone at 1800 931 678 (free call) or by postal mail: Australian Financial Complaints Authority, GPO Box 3, Melbourne VIC 3001.
If you believe that the issue is a breach of the AFIA Code of Practice, and it has not been satisfactorily resolved after raising it with both Klarna and AFCA, you can refer your complaint to the AFIA Code Compliance Committee ('CCC') who will assess it further. Where it is appropriate for it to do so, the CCC can make a range of recommendations to resolve a Complaint. To lodge a Complaint with the CCC, contact them at CCC-BNPL@afia.asn.au.
If a provision of these Payment Option Terms is invalid or unenforceable, it may be severed from these Payment Option Terms and the remaining provisions of these Payment Option Terms continue in force.
You must not assign or transfer your rights under these Payment Options Terms without our prior written consent (which may be given or withheld at our absolute discretion).