How Klarna integrates with InDebted as their preferred collections agency in multiple markets

Client profile

Klarna is a trailblazer in the global payments sector, with over 150 million customers worldwide. Their scaling expertise is second to none with their shopping solution now active across 45 countries.

Challenge

With such growth, Klarna requires a collections provider that can service their global customer base and deliver increased collections performance, while ensuring compliance with differing regulations across multiple markets.

InDebted’s Collect product is a perfect fit for Klarna’s needs, as an industry-leading collections solution with the capability to serve millions of people in different jurisdictions across the globe. Here’s how Klarna expands their customer base globally, backed by an intelligent collections product.

Solution

1. A full third party collections extension

Klarna began their partnership with InDebted in May 2020, starting with their Australian customers. Their initial onboarding method was via our standard SFTP upload - a secure file transfer protocol transferring customer data securely to our systems. During this time, our Product successfully collected a quarter of the total debt referred in Australia. This success drove Klarna to expand the partnership to their customers in Canada, New Zealand and the United States.

As a rapidly scaling business, the most effective way to transfer Klarna’s customers in multiple regions into InDebted’s product is by integrating with their API. This acts as a third party collections extension between Klarna’s system and our product - meaning that customers in multiple locations can be placed into our ecosystem in real time , without the need for repeated file transfers.

Building this type of integration requires the client to provide specifications of their internal systems used for processing customer information. In a fast-paced environment like Klarna, their API with InDebted is essential to transfer accounts into our Collect product , using their existing systems, with no restrictions. As a full third party collections extension, the API serves as a two-way communications tool and updates Klarna’s internal systems with how customers are progressing in their repayments journey.

2. Multi-market compliance

With customers in multiple markets, Klarna needs a collections partner that can support differing and complex collections compliance requirements. This becomes increasingly critical in more complicated regulatory environments like the US and Canada, where regulations, licences and consumer protection laws can not only differ at a federal level but also differ from province to province or state to state.

InDebted’s product has all regulatory requirements built directly into our code, for every country, state and region your customers are in. This is backed by a compliance-firewall feature, blocking the risk of non-compliant communications. As each location varies in the number of contacts permitted, regulatory notices, disclaimers, time zones and more, a rigorous approach to compliance is essential to any successful recoveries strategy.

This approach at InDebted is combined with an advanced data security framework with the added reassurance of ISO27001, SOC2, ISO9001 and PCI/DSS certifications.

3. Access to the world’s largest source of collections data intelligence

Advanced data driven intelligence is a key reason Klarna partners with InDebted, so they can deliver a personalised experience to each of their customers across the globe. Intelligent debt collection leverages insights from machine learning models to inform when to send every individual the right message, at the right time, on the right channel, giving customers the confidence they need to take action.

These models have been developed and refined for over seven years, using data from millions of customers worldwide. Customer data is carefully analysed to understand how different individuals prefer to engage to resolve their debt. These insights are called data derivations and are applied to all customers referred into our product, meaning that Klarna can take advantage of InDebted’s superior understanding of consumer behaviour in debt recovery. The more customers, the more data, the more advanced our modelling becomes at identifying uplift opportunities and better ways of collecting.

As a leading shopping solution, Klarna also gets value out of diving into how their consumers engage with their accounts, such as understanding how liquidation rates differ across age groups and location, or seasonality insights into payment behaviours.

Results

Klarna’s partnership with InDebted has made it seamless for Klarna to support their global customer base on their debt-free journey, as this integration allows them not only to send account data to InDebted’s product - but also see how their customers are progressing on their collections journey.

As a progressive business, Klarna now has a collections partner that matches their ambitions in scaling, digitisation and customer experience, making intelligent debt collection a natural fit.