Klarna announced an expansion of its financing agreement with Elliott Investment Management, increasing the size of the facility to $2 billion and lengthening its term to three years. Shares in the digital payments provider rose about 4% after the news.
Under the revised arrangement, which builds on a partnership first disclosed in November 2025, Klarna will continue to sell newly originated U.S. Financing receivables to Elliott-managed funds on a rolling basis. The structure is designed to keep those receivables off Klarna’s balance sheet while the company retains control over underwriting and servicing of the loans.
The company said the expanded capacity responds to robust performance within its U.S. Financing business, where it recorded meaningful gross merchandise volume growth in the fourth quarter of 2025. Klarna indicated the larger facility is intended to help meet rising consumer demand for its installment financing products.
"Klarna’s US Financing is growing fast because it gives Americans something the credit card industry never has: real choice, clear terms, and no surprises. This partnership sets the foundation for us to meet the accelerating demands of our American consumers," said Niclas Neglen, Chief Financial Officer at Klarna.
The financing uses a forward-flow and whole-loan sale structure so Klarna can increase the scale of its U.S. lending without adding those loans to its balance sheet. As loans in the facility amortize over the three-year term, new originations will continuously rotate into the program. Klarna said that, under this arrangement, it will be able to originate up to $17 billion in U.S. Financing loans across the life of the program.
Company executives described the expanded partnership with Elliott as a source of enhanced financial flexibility while Klarna continues to broaden its footprint in the U.S. market. Klarna’s installment products are positioned as alternatives to traditional credit cards in the U.S. consumer lending landscape.
While the announcement focused on operational capacity and balance sheet treatment, it also underscored the role of external funding partners in enabling Klarna’s U.S. growth strategy without materially increasing reported assets. The company framed the move as a way to scale lending activity in response to growing consumer uptake of its financing options.