Klarna partners with Coinbase to add USDC capital from institutional investors

Klarna is partnering with Coinbase to bring institutional stablecoin deposits. The payment and loan company will add USDC as a source of funding for its loans. 

Klarna announced it will allow USDC deposits, made possible through a Coinbase partnership. The payment and loan platform reaches out to large-scale holders of stablecoins, aiming to add their liquidity to its portfolio. 

The announcement arrives just weeks after Klarna shared plans to launch its own USD-backed stablecoin. However, USDC usage may arrive first, using the existing infrastructure of Coinbase Custody. USDC was one of the fast-growing stablecoins in 2025, expanding its supply from 42B to over 78B tokens for the past 12 months.

Klarna has been keeping a distance from crypto while building its own presence and brand for retail loans and the market for installment payments. This time, Klarna did not turn to crypto retailers, instead aiming to draw in the large-scale holders of stablecoins. 

Klarna’s business model centers around offering zero-interest loans in buy-now-pay-later (BNPL) offers for consumer products. 

Klarna onboards USDC as a source of capital

In 2025, stablecoin holders were seeking various sources of yield, putting their assets in DeFi vaults with differing levels of risk. Klarna may offer a much lower risk for USDC holders. The available pool of stablecoins may become a part of Klarna’s usual pool of available capital. 

Klarna uses capital acquired through its banking arm, accepting direct deposits or issuing bonds. 

‘Stablecoin connects us to an entirely new class of institutional investors,’ said Niclas Neglén, Klarna’s CFO, in a statement.

USDC deposits are as close as possible to direct fiat liquidity, as the stablecoin is fully regulated for the US market. Klarna and many other fintech apps for now avoid crypto-collateralized stablecoins. 

Coinbase holds assets on behalf of third parties through Coinbase Custody. As of December 2025, the platform carries around $50M in USDC. The USDC stablecoin is widely distributed and not concentrated in top addresses. The stablecoin is widely used by both crypto insiders and institutions. 

The inclusion of Klarna may take some of the liquidity from existing platforms. The partnership is one of the recent cross-overs between traditional and mainstream finance. Circle is also bridging the gap between fintech and crypto-insider activity, with significant growth in payment usage in 2025. 

Klarna meets financing headwinds

One of the key challenges of Klarna is the cost of funding. The company also aims to increase the share of longer-term loans in 2026. 

The company achieved 32% revenue growth in Q3, but had a net loss of $14M due to bad loan write-offs. 

KLAR shares also trade near their lowest range at $30.79. KLAR is one of the new tokens for 2025 that is trading under its ICO price. The company suffers pressure as trust in consumer credit remains low, noting the potential risk of bad loans.

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