Klarna Is Selling Up to $26 Billion of Buy-Now, Pay-Later Loans to Nelnet

Klarna Group Plc agreed to sell as much as $26 billion of buy-now, pay-later loans to the student loan giant Nelnet Inc. as the fintech looks for ways to free up capital ahead of its public debut.

The multi-year deal is structured as a so-called forward-flow agreement, where a buyer agrees to purchase loans before they have been originated. With the deal, Klarna will be able to expand its pay-in-4 product in the US, which allows consumers to split up purchases and pay them off interest free in a matter of weeks.