December 9, 2024, 9:25 am | Read time: 3 minutes
According to consumer advocates, the payment service provider Klarna could take a very close look at its customers’ account statements. However, this is disproportionate.
Nowadays, anyone shopping on the Internet has many payment options. In addition to direct debit or the credit card option, there are also service providers such as PayPal, which offer particularly convenient payment methods. Klarna also falls into this category. However, consumer advocates are now sounding the alarm because Klarna is said to be looking very closely at its customers’ bank statements.
Account Statements Allegedly Not Safe from Klarna
In an interview with Oliver Buttler from the consumer advice center in Baden-Württemberg, Der Spiegel revealed that Klarna would gain comprehensive insights into customers’ finances and purchasing behavior through their bank statements. The service provider could analyze “all account data from the past 30 days from the time of payment”. There is also the accusation that Klarna passes on information to third parties.
At least the mere insight into account movements does not appear to be completely illegal. The EU’s Payment Services Directive2 (PSD2), introduced in two phases from 2018 onward, stipulates, among other things, that “payment initiation and account information service providers” require access to accounts in order to provide their services. To do this, they need the express permission of the consumer. Without this consent, “no payment will be executed and no third-party service provider may access your account data”.
However, according to the report, it is not just about transactions that customers make via Klarna. The company would also be able to see whether you have a Netflix account or how much your monthly rent payment is.
Consumer Protection Criticizes Disproportionality
The fact that Klarna collects various banking information from customers is at least stated in the privacy policy. It explains that it looks at “data from your other bank accounts and other types of accounts (e.g., card accounts) that you link to the service, as well as data such as account number, bank, historical transactions from your linked accounts, balances, and assets.” This is for “financial analysis.”
However, it is not clear exactly what data is collected, especially regarding historical transactions. However, Buttler considers this to be disproportionate, and such a practice would otherwise only occur with large loans for the purpose of credit checks. He said he doesn’t understand why this would be necessary for “0815 payments in online stores”.
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What Klarna Says About It
But does Klarna really spy on consumers’ bank statements? TECHBOOK asked the service provider and received the following answer:
“Klarna does not sell any data to third parties. Klarna also does not analyze or access transaction data from bank accounts when payments are made. The only time Klarna accesses transaction data from bank accounts is when a customer chooses to use our ‘Personal Finance’ feature, where consumers can view all their bank accounts in one place within the Klarna app. This feature is only activated when the consumer actively chooses to integrate their bank account. Even in these cases, the data is only used to display information to the consumer in a transparent and user-friendly way. It is not analyzed for other purposes or shared with third parties.”
Klarna spokesperson
This is not the first time Klarna has been criticized. As recently as 2022, the payment service was presented with a Big Brother Award for pooling data and power in a non-transparent manner.