bro. Fucking – Think about it. Klarna pay in 3 installments divide the cost by 3 and take payments monthly. Month A, you pay one third. Month B you pay one third of months A and B. By month C onwards you’re consistently paying three thirds or 100% of the rent. You’d only defer yourself the value of one month’s rent over the span of two months. Pointless.
That’s how fucked our economy is. There is a significant number of people so close to the edge that buying an extra 10 days before eviction is the final gasp before becoming homeless.
Unless they are using the “Klarna Glitch” (see Identity theft)
https://frankonfraud.com/the-klarna-glitch-that-isnt-inside-the-new-viral-trend/
“Can’t pay rent? Don’t worry we have an even more humiliating solution for you!”
Can’t pay your monthly rent? We can pay it for you with a monthly payment schedule.
Could I get a loan to help me pay a klarna instalment?
How deeply can we dig this hole?
you are not gonna believe what the banks did in 2008
I knew a guy in college that kept getting new credit cards to pay off other credit cards he had maxed out. I wonder what his credit looks like now.
that’s me, been trapped in that cycle since I had to pay several months’ rent with credit card during covid
aside from some dings due to high credit usage, my score is good. mainly because i have a shit load of cards i opened years ago, so my average account age is high.
I’m not a particularly responsible spender and have a shit ton of debt, but since I make the CC companies a bunch of money by paying balance transfer fees all the time, I’m profitable. So my score is high.
What a stupid world
Gatekeeping basic necessities behind paywalls is economic violence.
Klarna is really pissing me off. I got a refund from a place, and they put that money into some kind of Klarna Wallet or whatever, by default, instead of in my bank account where the money originally came from.
So I go to their stupid site, and select the option to refund to my bank account, and they are warning me this will take up to 7 days! For no other reason than they wanting my money in their account so im tied to their service.
Stay the hell away from Klarna. Im doing that from now on.
wtf, how is that legal? if someone is obligated to pay you some refund, how can they send it to some other private business instead?
I assume because they received the payment through the private business, not directly from their bank.
all you had to do was reach second sentence of their comment and you wouldn’t have to assume.
Yes, you are right. The private business they gave the money to bought it for them.
they put that money into some kind of Klarna Wallet or whatever, by default, instead of in my bank account where the money originally came from.
Yes. That’s how things like that work. Similar to things like the playstore, or app store and such. Apple/Google/Klarna pays for the product, you pay Apple/Google/Klarna back for the product via whatever means, Mastercard, Visa etc that you attach to their store. If they don’t receive the money from you, your account goes into bad standing with Apple/Google/Klarna, not with whoever they bought the product from, because they received their payment. So if you put a stop on the payment from your bank, it will also put your account in bad standing as owing money for a product you “already received”. It’s a shit way to do things, having a middle person, but to avoid such… don’t buy things through a middleman.
Want say “Paramount plus”, buy it from Paramount, not using another service who takes it out of your bank because you gave them permissions to upon using their service.
Thousands of people run into issues because of things like this daily.
Man i love credit V2… If anyone is looking for me I’ll be out in the forest pretending to be a slug or something.
Where is Luigi when you need him?
Klarna 'bout to find out their business model doesn’t work as well in the US compared to the Nordic countries and EU, as
- People are already up to their neck in debt, putting Klarna to the back of the queue in case there’s a default
- Personal bankruptcy is a thing
Especially the Northern Europe personal bankruptcy is really not a thing, fuck up your finances and you’re never going to see a penny you make (above what you strictly need to live) until everything has been paid back. Debt that is actively being collected also never expires.
There’s a good reason Klarna’s been able to thrive in this environment – getting debt from banks is quite difficult and you have added security from the draconian collections process.
In the US a company ignores credit scores at their own peril. The bankruptcy process is one of the few things that works better in the US than in e.g. my home country Finland.
People are already up to their neck in debt, putting Klarna to the back of the queue in case there’s a default
People in debt (before there is professional help) end up paying the important things first (such as rent) and then choose to pay off the debt that is most within their reach. Klarna is much more likely to be a low amount compared to their creditors.
It might be true their loans are more likely to be payed back while also they might have less to loose in case of a personal bankruptcy.
But that aside, i have no clue on whether Klarna is making a smart move. But i assume they are because companies that are both evil and stupid don’t tend to come far.
Eh, I dunno about that last point. “Evil” is a pretty OP strategy if you have the stomach for it, usually leaves lots of room to survive doing dumb shit. And hot DAMN greed is good at convincing people to do dumb shit!
On the one hand, don’t underestimate their cunning, I do agree with that. But on the other, I’ve never liked the “4D chess” assumptions some folks are so willing to make (not meaning you here), it’s unwise to overestimate it, too.
Klarna is a thing in Germany as well and personal bankruptcy absolutely is a thing here [https://www.verbraucherzentrale.de/wissen/geld-versicherungen/kredit-schulden-insolvenz/privatinsolvenz-in-3-jahren-schuldenfrei-11417] so I don’t know if your second point is that relevant. I’d agree on the first one though.
Serves me right for assuming Germans had a similarly judgemental attitude to people who have ruined their finances. Thanks for the correction.
Finns often have a very puritan attitude to debt (you should fear it like the devil), and in the common discussion it’s often attributed to the ethics of the Lutheran church. That’s at least partially the reason we still don’t have a real personal bankruptcy option. Somewhat surprising to me that a country that shares that value system could be that forgiving to people – I’m a bit envious even 😅
Around here Klarna and other similar companies have long been seen as exploiting the fact that debt is really difficult to get through proper sources, and there’s a matching draconian bunch of collections agencies to support that business model. We’ve mainly been trying to tackle this by regulating the process of giving out loans, instead of giving people the necessary way out and thus giving the corporations an incentive to self-regulate.
If bad credit is actually no longer possible to collect on, it ceases to be good business. Hats off to Germany for having a proper route out of predatory loans.
I german but still hate debt. Why buy something pay off later? Why not just save up monthly then pay once? Same process, same result, 0 fee.
in general:
The depressed poor person has a lack of dopamine and is completely apathetic to poor decision outcomes.
here in specific:
they’re using it for rent, living on the street for a few months to set up your next rent payment is a poor option.
If you go to florid in the US there are PAYDAY loan shops ALL OVER THE PLACE. It’s the most bizarre thing. Interest rates are outrageous. Your check comes out, you can lose 13% of it to get it now… I suspect because drugs…
Yet more proof that “richest country in the world” doesn’t mean what Americans think it means.
Dystopian fucking timeline. Around every corner there seemingly waits billionaires waiting to fuck ppl over
People already put rent on their credit card to pay it off in chunks. This is just Klarna tapping in that market
People already put rent on their credit card to pay it off in chunks. This is just Klarna tapping in that market
People using CC to pay rent isn’t reassuring, it’s more alarming. Paying for housing on short-term, high-interest credit is financial insanity and implies profound dysfunction if not desperation.
Financing is bad at the best of times.
No, it’s not. Financing is a great tool, and used wisely and with knowledge of interest rates and total cost, can elevate you quite a bit in life.
This however is predatory lending, and it should not be used ever.
Care to explain? I got raised differently and avoid financing like the plague, but I’m coming to the realization that I won’t be able to do that forever.
How do you think it can be a net positive? Your insight might help me cope.
Others have said it here better than I could, but I was the same way but for probably other reasons. My mother lost her home, not due to misfortune but because she couldn’t manage her finances. Quick splurge items and random ideas too priority over long term stability. Anyway, so I thought mortgages and loans were scary too.
Then I got educated on them. They’re not scary if you understand what you’re doing. Loans are not scary, they are tools to achieve your goals. A tool can be extremely useful to accomplish your goal, but you also shouldn’t reach for that tool every time either.
If your goal is to own your home, a mortgage is a great tool if you know what you’re doing. Learning about interest rates, how they’ll affect you, sitting down and looking at your long term finances and knowing what you can manage paying every month for the forseeable future is how you can calculate what works for you.
Where it gets scary is when people walk in, not knowing what they can afford and taking everything the bank will give them, not knowing how much they’ll be paying over time. That’s when things get predatory and scary. Knowledge is power as they say.
Now when I need a loan I go in, and I know what interest rate I want, what duration I want, and exactly how much I need, and the bank usually says yes. I’ve proven myself with my credit score to be a trustworthy person to lend to, and l can now usually get pretty decent terms.
Learn about finances, learn the math, and learn how you spend money. Once you get that knowledge it stops being so scary.
Well my main hurdle is, that I don’t have any income right now. I’ve had 4 jobs in the last 10 years after finishing university, none of which lasted longer than 15 months, due to recurring health issues.
If also never lived in the same place for more than 4 years. (except my parent’s house)
So even if a bank would give me a loan, my confidence that I could manage to pay that off is pretty low. Which is kind of a sad state to find yourself in, in your late 30s.
I learned some of the math in uni for my engineering degree, but that was focussed on enterprises, where it makes sense if you generate revenue and get a return of investment to pay off the loan for that investment. I probably need to switch perspective, to actually appreciate it as a tool for cutting expenses in my daily life. If the day comes, where that won’t be purely hypothetical.
But still, I think that only applies to stuff like housing, where you have recurring cost, that could be lower (even if it’s just in the long run) or maybe a car, that you need to get to a job, where it basically enables you to make more money. I don’t see any other cases, where it really makes sense to pay interest on anything.
It’s all about your perspective and what you can handle. Housing is a great example. Do you pay for rent for 30 years while you save up to buy a house outright with no mortgage (but having paid rent that entire time on top of paying for the house) afterwards, or do you get the house now and pay the bank a percentage while you also get to live in the house.
The math seems bad when you look at one item, like paying interest seems like a lot. Until you realize the alternatives worse, like paying rent for 30 years and at the end you have nothing. At the end of the mortgage, you have a home.
It’s the same no matter what you decide to take financing on. Personally I agree, I only do it for house and car (although we were very clear about what terms we wanted for the car), and beyond that not much. I have a credit card I pay off every month to keep my credit score high. Beyond that, I never take financing from places.
This is a financially naive and reductionist take, approaching financial illiteracy. Applied correctly, financing allows you to preserve liquidity while still leaving funds in accounts with higher returns. Financing also provides a hedge against inflation, e.g. real estate.
If you’re the average earner, you absolutely cannot get loans at lower rates than the interest you may get on your meager savings.
I deeply empathize and sympathize with the challenge. I also failed to choose “congenitally rich” at birth, and I hope to remedy this error on my next iteration.
But seriously, I grew up very poor and left my abusive home at 16. I was homeless twice. Once in my late teens and again in my mid-20s. Not “crashing on my friends’ couches” homeless, but rather “living in the woods and dumpster diving for food” homeless.
I bring this up as empathy by way of anecdote, and also as acknowledgement of my immense luck and privilege. I know that reaching a place of relative comfort is fucking hard in our modern environment. What’s an even bigger pisser is that cost of living is stupid, the systems required for modern life are expensive, and the attacks on our attention, focus, health, and well-being are legion.
So it comes down to: is your position yet painful enough for you to want to do something about it?
I’m no Maoist but those ‘land reforms’ are starting to sound pretty good right now.
Hell yeah killing millions of innocent people and starving 50 million more because you dont like a Swedish finance app
Life expectancy doubled during Maoism. People starved because millions routinely starved in China as a preindustrial country. Compare starvation in China with that of India during Maoism, and you’ll see the tens if not hundreds of millions of lives communism saved against the alternative.
So what? Your core moral values are fucked if you think thats the case. You must look at what’s happening in American as completely ok because from Trumps point of view the end justifies the means.
If we apply that kind of logic it allows people in power to do whatever crazy action they want in as long as they are in pursuit of a “good” goal.
How’s Maoism comparable to Trumpism? Maoism reinforced women’s rights compared to what came before, reinforced worker’s rights, kickstarted industrialization, defeated fascism in China (both the Kuomintang and Imperial Japan), freed China from colonialism, and doubled life expectancy. It wasn’t perfect for sure, but any political alternatives at the time were measurably worse by any metric.
Buying groceries in installments is already bad enough, but if you are very good at lying to yourself and very bad at the detecting your own lies, you may be able to convince yourself that you are not going to need to buy groceries for the next four months.
But even this twisted kind of logic does not apply to rent.
Why do I keep getting surprised every time a new height of dumbness gets launched?
It’s not about dumb clients, everyone knows they have to spy groceries and rent, but being between literally being unable to buy groceries and having groceries and debt, many will choose the latter. It’s predatory
