H & M Hennes & Mauritz AB (publ) is investing in Klarna Bank AB (publ) as part of a partnership that will see the financial technology firm providing online and in-store payments for the retailer, according to an Oct. 8 announcement.
H&M did not disclose how much it is investing in Klarna, but the Financial Times reported earlier that the fast-fashion company is shelling out 185 million Swedish kronor to take a stake of less than 1% in the Swedish fintech firm.
The payment solutions under the partnership will make it possible for customers to "try before you buy" and allow them to pay for items using the H&M app both online and in physical stores, the apparel retailer said.
The companies plan to roll out the new payment services across 14 H&M markets, starting with the U.K. and Sweden, in 2019. According to the FT, H&M and Klarna are also looking at expanding the services to the U.S. and Asia in the future.
Klarna CEO Sebastian Siemiatkowski told the newspaper that the transaction marks its largest partnership after inking similar deals with U.K. online retailer Asos PLC and Swedish furniture retailer IKEA.
"What we are looking at here is doing something very strategic with H&M. It pulls together online and offline, it pulls the loyalty part in, in all of their channels, in all of their markets," Siemiatkowski said.
As of Oct. 5, US$1 was equivalent to 9.07 Swedish kronor.