Credit Building > Klarna Pros and Cons: A Complete UK Guide

Klarna Pros and Cons: A Complete UK Guide

Wollit Team1 minute read · Updated 19th February 2025

Considering using Klarna for your next purchase? This comprehensive guide examines the advantages and disadvantages of using Klarna in the UK, helping you decide if this Buy Now Pay Later (BNPL) service is right for you.

What is Klarna?

Before diving into the pros and cons, let's understand what Klarna offers. Klarna is a BNPL service that lets you split payments for purchases into manageable instalments. Available at thousands of UK retailers, it's become an increasingly popular alternative to traditional credit.

Klarna Payment Options

Pay in 3: Split cost into three interest-free payments
Pay in 30: Full payment within 30 days
Financing: Longer-term options (6-24 months)

The Advantages of Using Klarna

✓ Interest-Free Short-Term Payment Options

No interest on Pay in 3 or Pay in 30
Automatic payments spread over time
No hidden charges for standard options

✓ Flexible Payment Plans

Multiple payment options to choose from
Manageable instalment amounts
Automated payment scheduling

✓ Easy Approval Process

Soft credit checks for basic services
Quick decision-making
Available even with limited credit history

✓ Widespread Acceptance

Available at major UK retailers
Virtual cards for non-partner stores
Mobile app for easy management

✓ Purchase Protection

Buyer protection on eligible purchases
Dispute resolution service
Return payment protection

The Disadvantages of Using Klarna

✗ Potential Late Fees

£7 fee per missed payment
Cumulative charges possible
Impact on future Klarna use

✗ Limited Credit Building

Regular payments don't boost credit score
Missed payments can harm credit
Not ideal for credit improvement

✗ Risk of Overspending

Easy access to credit
Multiple payments to track
Potential financial strain

✗ Interest on Longer Terms

Higher APRs on financing options
Interest charges can accumulate
May be costlier than alternatives

Customer Experience

What Users Say

Positive Reviews Mention:

Easy to use
Convenient payment splitting
Helpful for budgeting

Negative Reviews Highlight:

Customer service delays
Late payment issues
App glitches

Is Klarna Right for You?

Consider using Klarna if you:

Want to spread costs interest-free
Can manage regular payments
Need short-term payment flexibility
Have a stable income

Avoid Klarna if you:

Want to build credit
Struggle with payment tracking
Have irregular income
Are trying to reduce spending

Tips for Using Klarna Responsibly

Only borrow what you can afford
Keep track of payment dates
Maintain sufficient bank balance
Monitor all BNPL commitments
Set up payment reminders

Alternatives to Consider

Before choosing Klarna, consider:

0% credit cards
Traditional credit options
Saving for purchases
Store payment plans

Final Verdict

Klarna can be a useful tool when used responsibly, offering convenience and flexibility for short-term purchases. However, it's crucial to understand the risks and manage payments carefully to avoid problems.