Consumers can use Klarna at the online checkouts of Argos, Habitat and Tu. Credit: Just Jus/Shutterstock.

Supermarket chain Sainsbury’s has partnered with AI-powered global payments network and shopping assistant Klarna to introduce interest-free payment methods including Buy Now Pay Later at three of its brands. 

Online shoppers at Argos, Habitat and Tu can benefit from Klarna’s three payment methods: paying immediately and in full with Pay Now, paying in 30 days with Pay Later, or paying over three equal instalments with Pay In 3. 

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Klarna’s chief commercial officer David Sykes said: “More than 20 million Brits already use Klarna and now they can enjoy our flexible payment options at more of their favourite stores. Argos, Habitat, and TU are British icons known for reliability and value, making Klarna’s interest-free payment solutions a seamless fit. We’re super excited for this first step in our partnership with Sainsbury’s.” 

The partnership comes as interest-free BNPL attracts more customers, with a total UK BNPL spend of £30bn in 2024.   

The BNPL sector in the UK is largely unregulated, Bloomberg has reported. 

In 2023 Klarna introduced late fees, which helped more customers with their repayments.  

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The Swedish fintech company has been making significant strides in the UK market, collaborating with brands such as Deliveroo, Harrods and Liberty.  

The company is also preparing for a potential initial public offering and has recently established a new UK-based holding company to provide flexibility for its listing location.

Klarna has also seen rapid growth in the US, where it has partnered with Walmart.  

For Sainsbury’s, the partnership with Klarna comes as it plans to focus more on improving sales online.

In June 2023, Argos completed its exit from the Republic of Ireland with the closure of its 30 remaining stores. 

In February 2024, Sainsbury’s stated that it planned to outsource Argos financial services to a third party while maintaining its significance within the business.