Klarna B.V. and Sweden-based Klarna AB face a formal liability claim exceeding €500 million in the Netherlands after consumer foundation Stichting Massaschade & Consument formally held the buy now, pay later provider liable on July 12 over alleged unlawful lending practices. SMC accused Klarna of issuing credit without legally required affordability checks and allowing minors to use its services. The foundation launched its consumer campaign on July 13 and invited affected customers to register, while inviting Klarna to settlement discussions expected in August or September as preparations for potential legal proceedings continue.
SMC Foundation Claims Klarna Services Constitute Regulated Consumer Credit
SMC argues that Klarna's services, including options allowing customers to pay after 14 or 30 days, amount to consumer credit rather than a simple payment method. The foundation says those agreements should be subject to rules requiring lenders to assess whether customers can afford the credit and to provide clear information about its costs and risks.
According to SMC, Klarna failed to perform adequate creditworthiness checks, did not sufficiently warn customers about the risks of deferred payment and handled disputed transactions, returns and alleged fraud cases improperly. The foundation also claims Klarna's age controls were ineffective and could be circumvented by minors.
SMC is seeking repayment of purchase amounts as well as reminder charges, late-payment penalties and debt collection costs paid by affected consumers. The foundation estimates that Klarna's potential repayment liability could exceed €500 million, although the final amount would depend on the number of qualifying consumers and the outcome of any court proceedings. The claim targets primarily consumers who were charged additional costs after paying late or after their accounts were referred for collection. Minors who entered Klarna agreements without parental or guardian consent may also be included even if they were not charged extra fees.
SMC's published timeline indicates that the case has not yet reached court. The foundation has invited Klarna to discuss a possible resolution, with settlement talks expected in August or September, while preparations for legal proceedings continue.
Kifid Rulings in April Established Legal Basis for Broader Claim
SMC's case follows two binding decisions issued by the Dutch Financial Services Complaints Institute, Kifid, in April. In those cases, two consumers used Klarna to pay for online purchases. One said the product was never delivered, while the other said the item had been returned.
Kifid determined that deferred payment constituted credit and that Klarna had not adequately demonstrated that it had conducted the required creditworthiness assessments or complied with information requirements. Kifid described the failures as serious breaches of consumer credit rules and cancelled both agreements. The consumers' payment obligations were removed retroactively, and Klarna was ordered to repay any amounts already collected.
Kifid said it had other Klarna complaints under consideration and would generally follow the same reasoning in similar cases, although individual circumstances could produce different outcomes. Those decisions provide a legal basis for SMC's broader claim, though they involved two individual disputes and do not automatically establish that all Klarna agreements in the Netherlands were unlawful.
SMC argues that agreements issued without the required affordability checks or information could be legally voidable. If a court accepts that argument, consumers could seek to unwind the transactions and recover both the original purchase price paid to Klarna and associated charges.
Dutch Regulators Found 600,000 Minor-Linked Transactions in 2023
Klarna faced scrutiny earlier in 2026 over its debt collection practices. Dutch legal experts said the company had been sending payment reminders without being listed in the country's register for out-of-court debt collection providers. Registration became mandatory in April 2025, and unregistered collection activity can constitute an economic offence. Klarna said at the time that it needed to assess how the legislation applied to its operations. The Dutch Justice and Security Inspectorate did not comment on the individual company.
The allegations involving minors reflect concerns previously raised by the Dutch Authority for the Financial Markets. The regulator found that almost 600,000 iDEAL transactions linked to BNPL providers were made in 2023 through accounts registered to minors, mainly people aged between 13 and 17. The average transaction was about €50.
The regulator cautioned that it could not determine whether every transaction had been initiated by a minor, but said the figures showed a real risk that age checks were being bypassed. The same research found that Dutch BNPL providers processed about 45 million transactions worth €4.8 billion in 2022. Consumers under 35 were more likely to miss payment deadlines, incur reminder fees or have debts transferred to collection agencies.
Settlement Talks Scheduled for August or September
Dutch authorities have pushed for tighter controls. Under incoming consumer credit rules, BNPL providers are expected to face formal creditworthiness assessments, stronger disclosure requirements and mandatory age verification. The Dutch government has also opposed extending deferred-payment services into physical shops, warning that easier access could increase payment problems among younger consumers.
Klarna had not publicly responded to SMC's allegations when the initial Dutch reports were published. The foundation has said it prefers a negotiated resolution but will continue preparing its collective case while waiting for the company's response. SMC has invited Klarna to discuss a possible resolution, with settlement talks expected in August or September.
FAQ
What did SMC accuse Klarna of on July 12?
SMC formally held Klarna B.V. and Klarna AB liable on July 12 over alleged unlawful lending practices, accusing the company of issuing credit without legally required affordability checks and allowing minors to use its services.
What did Kifid rule about Klarna's deferred payment services in April?
Kifid issued two binding decisions in April determining that Klarna's deferred payment constituted credit and that Klarna had not adequately demonstrated it conducted required creditworthiness assessments or complied with information requirements. Kifid cancelled both agreements and ordered Klarna to repay amounts already collected.
How many minor-linked BNPL transactions did Dutch regulators find in 2023?
The Dutch Authority for the Financial Markets found that almost 600,000 iDEAL transactions linked to BNPL providers were made in 2023 through accounts registered to minors, mainly people aged between 13 and 17, with an average transaction of about €50.
