Financial services are highly regulated. This means that Klarna and our merchants who advertise with us need to follow the laws and regulations that govern advertising financial products.
The following Financing Advertising Guidelines provide a general overview of the requirements you need to follow when advertising Klarna’s financing products offered in partnership with WebBank. Remember that it is also your responsibility to learn and understand the laws governing the advertising of financial products.
If you ever have any questions, please reach out to your Klarna marketing contact or us.comarketing.support@klarna.com.
This Financing Advertising Guideline should be reviewed along with the Pay in 4/Pay in 30 Advertising Guideline, along with the Legal Disclosure Table and the Social Media Disclosures
If your ad mentions monthly financing, the following disclosure is required to be included in the marketing materials.
Examples of messaging that references monthly financing (this list is not exhaustive).
If your ad mentions both Pay in 4 and/or Pay in 30 and monthly financing, the following disclosure is required to be included in the marketing materials:
If you list payment terms when referring to Klarna’s monthly financing products offered through Klarna’s partnership with WebBank, you need to understand the Truth-in-Lending Act. Please review the next sections carefully.
You have to disclose important terms of credit to a consumer when you advertise Klarna’s financing products offered in partnership with WebBank. When advertising terms of this type of credit, advertisements can only state terms that are actually available. When you mention specific terms of credit (called “trigger terms”), TILA requires you to provide the full terms of repayment. The best way to do this is by using a representative example of what a real loan might look like. This helps consumers understand what they are agreeing to.
The following are examples of trigger terms. If you use these, you need to provide a representative example.
The following words aren’t trigger terms. If you use them without the above mentioned trigger terms, you don’t need to include a representative example.
If you use a trigger term, you have to provide a representative example. A representative example shows what a typical loan looks like and needs to include the following information:
For the Open Tailored Financing Product, you need to include the following in the representative example:
Annual Percentage Rate (please note that the APR in a representative example should always be (i) the rate available to the majority of consumers or (ii) the median rate).
A $1000 purchase might cost as low as $172.79 per month over 6 months at 12.49% APR.*
And you must also include the following legal disclosure:
Promotional purchase rate ranges from 0%-19.99% APR. Non-promotional balances have an APR of 19.99%. Subject to a $2 monthly minimum interest charge and credit approval. APR based on creditworthiness and subject to credit approval, resulting in, for example, [X] [(number of monthly payments)] equal monthly payments of $ [X] [(amount at 0% APR)] to $ [X] [(amount at 19.99% APR)] per $ [X] [(amount borrowed that the calculation is based on)] borrowed. Minimum purchase of $ [X] [(min purchase amount)] required. 0% APR financing only available to qualified customers with excellent credit history. Monthly financing through Klarna issued by WebBank, member FDIC. See terms.
This needs to be updated manually each time this is placed in an advertisement or on a merchant website. Please see below for more information.
For the Closed Term Loan Financing Product, you need to include the following in the representative example:
A $1000 purchase might cost $172.79 per month over 6 months at 12.49% APR.*
You must also include the following legal disclosure:
Rate ranges from 0%-29.99% APR based on creditworthiness and subject to credit approval, resulting in, for example, [X] [(number of monthly payments)] equal monthly payments of $ [X] [(amount at 0% APR)] to $ [X] [(amount at 29.99% APR)] per $ [X] [(amount borrowed that the calculation is based on)] borrowed. Minimum purchase of $ [X] [(min purchase amount)] required. 0% APR financing only available to qualified customers with excellent credit history. A down payment may be required. Estimation of monthly payment excludes potential tax and shipping costs. Monthly financing through Klarna issued by WebBank, member FDIC.
This needs to be updated manually each time this is placed in an advertisement or on a merchant website. Please see below for more information.
[X][(number of monthly payments)] | This is the number of monthly payments that corresponds to the advertisement monthly rate in an advertisement. |
$ [X][(amount at 0% APR)] to $ [X][(amount at 29.99% APR)] | These two numbers represent the range of possible monthly payments a consumer might owe, from lowest at 0% APR to highest at 29.99% APR. |
$ [X][(amount borrowed that the calculation is based on)] | This amount should typically be a round number that corresponds to the actual amounts borrowed, so if the merchant’s products cost $500, this could be per $100 borrowed, or if they cost $5000, this could be per $1000 borrowed. |
$ [X][(min purchase amount)] | If there is a minimum purchase amount required to be eligible for financing, that number should be listed here. |
If you have any questions or are unsure, please reach out to your Klarna representative for advice.
The best way: put the representative example [on the same creative] as the trigger term—in close proximity, and in a similar font size.
Alternative: If there simply is no space to fit the representative example on the content/creative, you have to link to a landing page (educational page about Klarna) where the representative example is clearly and conspicuously displayed. The representative example needs to be within one click of the trigger term.
You should always have a Klarna educational page on your site. This page will educate your customers about Klarna’s products and make required disclaimers and disclosures. Your Klarna educational page can be automatically generated using Klarna’s On-Site Messaging tools, using these guidelines.
Emails
Emails with TILA trigger terms must include the full terms of repayment or a representative example in the email itself, not one click away. Please ensure that you have reviewed this Financing section and the legal disclosures table to ensure all appropriate disclosures are included.
If your ads are in a Video and/or TV-spot
For any videos/TV spots that mention trigger terms, a representative example needs to be included.
If you advertise using phone calls or text messages, then you are subject to the Telephone Consumer Protection Act (TCPA) and the requirements of carriers. These laws and rules require prior express written consent to send advertising via (a) calls to traditional home, business, or wireless phones or (b) texts to wireless numbers, among numerous other requirements. For example, you may not contact anyone on the national do not call registry.
The TCPA and carrier requirements are complex, and violating them comes with the potential for lawsuits and fines. You should obtain the advice of your own lawyers before sending advertising via telephone or text.
Do not use the following terms:
If you are ever in doubt, contact us.comarketing.support@klarna.com.
In addition to what we have covered so far, your advertising must also follow all of the laws that apply to financial advertising and advertising generally. This section summarizes key laws and regulations.
Unfair, deceptive, or abusive acts and practices can cause significant financial injury to consumers, erode consumer confidence, and undermine the financial marketplace. UDAAP was established to prevent consumer harm by misleading or deceitful actions. There are both federal and state UDAAP laws and regulations.
What you need to do.
What else you need to know.
Fair lending applies to the entire lifecycle of a loan, including advertisement of the credit product. The Equal Credit Opportunity Act (ECOA) is a law that requires credit products, like those offered by Klarna, to be advertised fairly to everyone.
The CAN-SPAM Act covers all commercial messages, which the law defines as “any electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service,” including email that promotes content on commercial websites. CAN-SPAM includes business-to-business email. The Federal Trade Commission has provided the below guidance to comply with CAN-SPAM: