Fintech cost cuts: The complaints at Klarna

by James · May 5, 2023

Fintech still has its success stories, but the money coming in just isn’t the same as last year. Not everyone can afford to be in hyper growth mode and it needs to be cut. Buy now, pay later (BNPL) stalwart Klarna may still be able to attract executives from other top fintechs, but at lower levels employees are voicing their displeasure with fintechs’ efforts to cut costs that are making life harder for them.

Klarna has a bit of a bad reputation when it comes to wages. While salaries above $100,000 are being lumped in elsewhere, only one engineer at the fintech unicorn has reported a Total over $100k compensation at Levels.fyi. Given that Klarna lost $1 billion last year, it probably won’t be able to offer the huge pay packages, whether they want to or not. Potential regulatory changes in the BNPL sector are also on the way. Klarna has to put a brake on consumption, and it seems that it is clamping down where it can.

An anonymous employee speaking to eFinancialCareers says the cost-cutting has filtered down to hotel rooms and that there is now “room-sharing at corporate off-sites for non-executive team members with justification required for every expenditure over a few hundred euros.”

They also complain about the “abolition of the work from home subsidy”. Klarna’s dedication to a hybrid model included “an annual payment contribution and equipment… to enhance personal home office or upgrade work accessories.” Not any more.

How bad is it really? Klarna says its automated working from home ended in December 2021 and that home office expenses can still be claimed back on an “as needed” basis as long as they are pre-authorised. It adds that employees can still be covered for “business-related costs that are within the policy.”

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