I really hope there’s nothing dodgy going on there

In 2023 they got a 1.1 million SEK fine for breaking the law that regulates working hours. To “allow” (strongly encourage) your employees to work nightshifts you need a collective agreement approved by the union, which they didn’t have.

More recently, they got a 500 million SEK fine for skirting the anti-money laundering regulations in Sweden.

But at least I’m not giving them interest on anything I buy. Always make sure I’m paying my stuff on time, and no postponed payments.

The whole “buy now, pay later” deal is a credit loan. They are most likely paying the merchant directly and using your loan as collateral to speculate on the market, until you pay them back for that loan. If that’s true, they are making profit on the interest gained from your loan.

I’m guessing their business model is to exploit people who have issues paying on time and to collect interest and late fees, as well as receive convenience fees from stores implementing Klarna as a payment option.

Correct. Like all credit banks they promote the “buy now, pay later” option before direct payment, which is becoming a pandemic on our society. Hardly any user interaction needed. They also offer their own payment plans which encourages buying even more expensive items you cannot afford.