As part of its ongoing efforts to solve the climate crisis, the company has announced the third round of contributions from its internal carbon tax, which will go towards various companies and organisations that are developing climate-based projects. Specifically, Klarna will contribute a total of USD 2.35 million towards these climate initiatives.
Klarna’s internal carbon tax added up to USD 5.07 million since 2021, and it was created to provide as much long-term climate impact as possible. According to the company press release, Klarna decided to avoid purchasing carbon credits to further its climate neutrality ambitions. Instead, it contributes funds from its internal carbon tax.
Later in 2023, Klarna will provide a portion of its USD 2.35 million contribution to new projects geared towards innovative climate solutions for carbon removal. These solutions were selected together with Klarna’s strategic partner Milkywire.
Some of the benefiting companies include Carbon Capture Scotland, Kenya-based Takachar, Netherlands-based SeaO2, UK-based Direct Air Capture, Kenya-based Octavia Carbon Designs, UK-based Parallel Carbon, Canada-based TerraFixing, and Inplanet, which is an Enhanced Rock Weathering (ERW) startup working in tropical Brazilian agriculture.
Apart from sponsoring these projects, Klarna is making its own progress in reducing carbon emissions. According to Klarna, its absolute carbon footprint decreased by 3.75% in 2022 compared to 2021, all thanks to various improvements in reducing emissions from purchased goods and services as well as capital goods.
Klarna also fulfilled its goal of ensuring that all of its office locations reach 100% renewable energy usage at the end of 2022. By 2030, Klarna wants to reduce 50% of its carbon-intensity-based emissions in line with the Paris Agreement. Furthermore, the company wants to achieve net-zero operability by 2040.
In May 2023, Klarna launched the UK’s first voluntary credit ‘opt out’, which is an additional tool in the Klarna app that can help consumers save time and money. The new feature will assist customers in meeting their financial objectives by giving them the option to 'pre-decide' not to use credit. For instance, this new feature can be used when saving for a certain life event or adhering to a very strict budget.
Klarna's credit offerings were designed to keep consumers from accruing significant outstanding balances. Unlike credit cards, the firm only loans to people who can afford to repay by performing strict eligibility checks on each transaction.
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