Yes, Klarna is regulated by the Financial Conduct Authority. Klarna Financial Services UK Ltd is authorised as an electronic money institution (FRN 1021834) for the Klarna Card and Klarna Balance, and separately for consumer credit (FRN 987889) covering its longer-term Pay Later financing plans.

Because Klarna Balance is e-money rather than a bank deposit, it is not covered by the Financial Services Compensation Scheme. Instead, EMI safeguarding rules require Klarna to hold customer funds in segregated accounts so they can be returned to you if the firm fails. The Klarna Card is issued via Visa and carries standard Visa fraud protections.

Buy Now Pay Later itself has historically sat outside FCA oversight in the UK, but that is changing: from 15 July 2026, BNPL providers including Klarna must be FCA-authorised under new consumer credit rules covering affordability checks, clearer terms, and access to the Financial Ombudsman Service. Klarna already operates regulated credit products and has publicly welcomed the new regime.

Klarna suits anyone who already shops with retailers that accept it and wants a flexible way to pay. The new debit card and wallet are useful for people who like the option to split payments via Buy Now Pay Later but also want a regular debit card for everyday spending.

The wallet is best used as a top-up card you load before spending, rather than as a primary current account. There are no direct debits or standing orders yet, so it does not replace your main bank account.