The news: Klarna launched a browser extension that enables buy now, pay later (BNPL) for online shoppers even if Klarna isn’t partnered with the merchant, per a press release. The tool is compatible with Google Chrome, Microsoft Edge, and soon Firefox and Safari.

Here’s how it works: The extension lets shoppers generate one-time Visa cards when they shop online that can enter as a regular card during checkout. It can automatically apply discounts—through its recent acquisition of discount provider Piggy—and lets shoppers earn rewards like cash back or gift cards, depending on their location. Shoppers can also save items and activate price-drop notifications.

The opportunity: The browser extension rounds out Klarna’s suite of tools to grab more market share as the space grows increasingly competitive.

• It makes it easier for Klarna to reach more customers through a popular shopping channel. More than 60% of US ecommerce sales are expected to occur via desktops and laptops this year, per eMarketer forecasts from Insider Intelligence. Although Klarna already facilitates online shopping through its standalone button for partners and its mobile app for non-partners, the extension makes it easier for shoppers using a desktop or laptop to access its BNPL product. And the rewards and price-drop notifications further incentivizes spending, which can help increase Klarna’s volume.
• And the tool can also support Klarna as it battles major payment players. The feature helps Klarna keep up with BNPL competitors that offer similar products, like Zip or PayPal, which owns popular browser extension and discount provider Honey. But more notably, the tool’s rewards feature makes Klarna more like credit cards—increasing the BNPL provider’s offenses against issuers, many of which have been stepping into the BNPL space lately.

The problem: Klarna’s new shopping feature can help the provider grab more volume, but it may also feed into one of the big financial concerns surrounding BNPL—overspending.

Zip recently faced backlash over its browser extension: Some users were concerned that the tool would add fuel to the fire for consumers who already struggle with managing their credit. These are the types of financial risks that are helping push regulation in the BNPL space: Australia, for instance, recently drafted more robust BNPL regulations, and stricter rules in the US could follow.

Related content: Check out our latest BNPL coverage to see what providers are doing to woo customers.

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