Klarna and UATP Partner on Flexible Payment Options for Airlines

Global payment network UATP and buy now, pay later (BNPL) provider Klarna have partnered to allow airlines to offer Klarna’s flexible payment options.

With this collaboration, airline customers can select Klarna’s immediate payments; short-term, interest-free BNPL; or longer-term financing for travel products and services, the companies said in a Tuesday (Sept. 10) press release.

The partnership is expected to go live by the end of the third quarter, according to the release.

“BNPL is an essential payment option for travel merchants to provide their customers,” Zach Ornelas, senior vice president of global sales at UATP, said in the release. “It offers flexibility and convenience to encourage travelers to complete transactions and boost conversion rates.”

The new partnership strengthens UATP’s support for BNPL options and helps its merchants tap into the growing BNPL market, according to the release.

It also gives Klarna immediate access to the airlines and travel agencies that are among UATP’s, the release said.

Together, the companies enable airlines and other travel merchants on the UATP network to add BNPL more quickly, per the release.

“Travel is perfect for interest-free buy now, pay later, allowing travelers worldwide to spread the cost of their trips and without getting stuck paying sky-high credit card interest rates,” Erin Jaeger, head of North America at Klarna, said in the release. “This agreement with UATP means we can quickly bring these benefits to many more airlines and tap into the huge growth opportunity which the $1 trillion travel industry represents for us.”

Travel and hospitality firms worldwide are increasing their investments in payment upgrades, according to the PYMNTS Intelligence and Ingo Payments collaboration, “Travel Tips: Instant Payments for Tips and Payouts in Travel and Hospitality.”

Klarna has formed several partnerships in this space in recent months. The company expanded its partnership with travel company Expedia to offer flexible payments to travelers in the United States; teamed up with Uber to let users in the U.S., Germany and Sweden use Klarna’s Pay Now option to cover the cost of their next ride immediately and in full; and collaborated with luggage and travel accessories brand Away to offer BNPL options to that company’s customers in the U.S., Canada and the United Kingdom.