Klarna Fee Calculator

How it is calculated

Buy now, pay later providers charge the merchant a percentage of the order plus a fixed amount, typically well above card rates, in exchange for paying the merchant up front and carrying the credit risk.

Merchant cost = order × rate + fixed. The merchant is paid in full regardless of whether the customer completes their instalments, which is what the premium buys.

Numbers on it

A $58 order at a representative 4.5% + $0.30: $2.91, an effective 5.02%. Against a card at $1.98, the BNPL order costs $0.93 more.

For that to pay, BNPL has to either convert orders that would not have happened or raise the order value. Both effects are commonly claimed and both are measurable.

If BNPL raises average order value from $58 to $76, an uplift providers frequently cite, the contribution comparison changes entirely: $76 at 55% margin less $3.72 of fee beats $58 less $1.98 by $14.10.

What it does not tell you

The uplift figures quoted by providers come from their own merchants and are not a controlled comparison. The customers who choose BNPL may simply be the ones who were always going to spend more.

Returns are also more complex. A returned BNPL order has to be unwound through the provider's system, and the merchant fee is typically not refunded, so a returned order costs the full fee plus the fulfilment.

What follows from it

Measure the uplift yourself rather than accepting the provider's number. Compare average order value and conversion for the period before and after enabling it, or better, run it on a subset of traffic.

Then check whether the fee is refunded on returns. In a category with a high return rate that single term can outweigh the uplift entirely.

The regulatory direction

BNPL has moved from largely unregulated to actively regulated across several major markets, with affordability checks, credit reporting and complaint mechanisms being introduced. That changes the product's economics and its approval rates.

For merchants the practical effect is that approval rates may fall as checks tighten, which reduces the conversion benefit that justified the fee. A business whose case for BNPL rests on a conversion uplift measured before those changes is working from a stale number.

It is worth re-measuring rather than assuming the original result holds. The fee is certain and the uplift is not, which makes it exactly the kind of arrangement that should be re-tested annually rather than set once.

Whether the merchant fee is refunded when an order is returned. In a category with a 25% return rate, a non-refundable fee on returned orders adds roughly a third again to the effective cost of the payment method.

That single clause frequently decides whether BNPL is viable in apparel, where returns are highest and where BNPL adoption is also highest, which is an unfortunate combination if the terms are unfavourable.

Beyond that, the share of BNPL orders from returning customers. Where most BNPL volume comes from people who already buy from you, the payment method is redistributing existing orders at a higher fee rather than adding new ones.