In the latest sign of rising financial strain, Klarna—one of the world’s largest “buy now, pay later” (BNPL) services—has reported a net loss of $99 million in Q1 of 2025, more than double its losses from the same period last year. Even more concerning: Klarna’s customer credit losses rose to $136 million, a sharp indicator of how debt is quietly piling up for everyday consumers.

The BNPL Boom Comes at a Cost

Buy now, pay later (BNPL) platforms like Klarna, Afterpay, and Affirm have grown rapidly over the last few years by offering consumers a seemingly easy way to split payments across time—often with little or no interest. Klarna alone has reached over 100 million users worldwide.

But there’s a catch: many users overextend themselves. These platforms don’t always assess credit as rigorously as traditional lenders, making it easy to rack up balances across multiple purchases. As a result, people who are already struggling financially may unintentionally dig themselves into deeper debt.

Klarna’s Rising Losses Signal a Bigger Problem

A $136 million spike in credit losses means more people are failing to repay. That’s not just a Klarna problem—it’s a consumer debt crisis. Americans are increasingly relying on installment services to afford essentials like clothing, electronics, and even groceries. But unlike credit cards, many BNPL users don’t track or budget their spending the same way.

The convenience masks the risk.

What You Can Do If You’re Feeling the BNPL Squeeze

If you’re one of the millions of Americans using buy now, pay later services to stay afloat, it’s time to take a serious look at your financial plan.

• List every payment plan you’re committed to. Many consumers forget how many Klarna or Affirm installments they owe.

• Check your bank account. Are your payments eating into your ability to cover basics like rent, utilities, or groceries?

• Consolidate debt where possible. Instead of juggling multiple apps and due dates, consider a single monthly payment through debt consolidation.

• Ask for help. If your BNPL usage is part of a larger debt problem, Debthunch can help match you with a personalized solution to reduce your payments and regain control.

What you can do to escape the BNPL trap

Klarna’s growing losses are a warning sign. The BNPL model may feel like a modern solution, but when credit losses surge, it’s consumers who are often left behind.

If you’re feeling overwhelmed by debt—whether from Klarna, credit cards, or other sources—Debthunch is here to help.

📘 Answer a few quick questions to see if we can find you a debt relief solution today.