Klarna Faces U.S. Securities Class Action Over IPO Disclosures on BNPL Credit Risk

New updates have been reported about Klarna.

Klarna Group plc is at the center of a newly highlighted U.S. securities class action alleging that the company and certain executives misled investors about credit risk and loss reserves around its September 2025 IPO. The lawsuit, pending in the U.S. District Court for the Eastern District of New York (Nayak v. Klarna Group plc, et al., No. 25-cv-7033), claims Klarna’s registration statement and prospectus for its NYSE listing (ticker: KLAR) omitted or understated the likelihood that loss reserves on its buy now, pay later (BNPL) portfolio would rise materially within months of the offering. Plaintiffs allege Klarna knew or should have known that the risk profile of many BNPL borrowers made higher near‑term credit losses probable, rendering its IPO disclosures materially false, misleading, and negligently prepared under federal securities laws.

The case focuses on investors who bought Klarna securities pursuant or traceable to the IPO documents and asserts that when the market learned the “true details,” those investors suffered economic harm. While the complaint’s specific financial claims are not detailed in this notice, any sustained increase in expected credit losses or reserve build would directly affect Klarna’s earnings quality, capital planning, and perceived risk in its BNPL model—critical metrics for equity and debt holders. The filing underscores heightened regulatory and investor scrutiny of BNPL underwriting standards and reserve adequacy at a time when macroeconomic uncertainty and consumer credit normalization are pressuring the sector. Investors with substantial losses have until February 20, 2026, to seek appointment as lead plaintiff, a step that could influence litigation strategy, potential settlement dynamics, and future disclosure practices at Klarna. Executives and stakeholders should monitor the case for its implications on Klarna’s litigation exposure, cost of capital, and the disclosure framework it uses for credit risk and provisioning going forward.