Klarna, which calls itself a "buy now, pay later" shopping service provider, announced Tuesday that Etsy has launched the service for its customers.
Offering users the option to pay for purchases in installments, Klarna will be available to Etsy (ETSY) customers in the U.S. now and head to other markets in 2021. Klarna supports purchases that range from $50 to $10,000.
Etsy joins a growing list of retailers and brands, including Abercrombie & Fitch Inc. (ANF) and Peloton Interactive Inc. (PTON), that have added the installment payment option.
Last week, Klarna announced that it has partnered with Macy's Inc. (M) to offer the option. Moreover, Macy's has invested in Klarna, though the company did not disclose the financial details of the arrangement.
See: Kohl's to launch private-label brand amid renewed focus on casual lifestyle merchandise (link)
Klarna says its flexible payment services are particularly appealing to millennials and Gen Z, who are reluctant to take on credit cards due to student loans and other financial worries.
"Being able to buy now and pay over time fits into people's monthly budgets and helps reduce their dependence on credit," the company said in a statement sent to MarketWatch.
PayPal Holdings Inc. (PYPL) launched an interest-free installment payment option in the U.S. in August. (link)
And earlier this month, financial technology company Affirm Holdings Inc., which also offers installment payments, announced that it has filed confidential paperwork to go public (link).
Etsy stock has more than tripled for the year to date, up nearly 237%. The Amplify Online Retail ETF (IBUY) has gained 89.4%. And the S&P 500 index is up nearly 7% for the period.
-Tonya Garcia; 415-439-6400; AskNewswires@dowjones.com
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10-24-20 0921ETCopyright (c) 2020 Dow Jones & Company, Inc.