‘Pay later’ firm in rap over adverts
STORE credit giant Klarna has been shamed for using social media influencers popular with young women to ‘irresponsibly encourage’ borrowing.
The company is one of a number of ‘Buy now, pay later’ firms offering services through retailers which allow people to buy items for immediate delivery to be paid at a later date.
Klarna works with major fashion and beauty product brands such as H&M, Michael Kors and Charlotte Tilbury. But the Advertising Standards Authority (ASA) has now named and shamed the firm, based in Sweden, following a campaign in which it used four Instagram social influencers to push its credit services.
The influencers at the centre of the complaints were Claire Menary,
Aisha Master, Bradley Harper and Yasmin Fatollahy. All put their names to Instagram posts suggesting buyi ng clothes or beauty products through Klarna’s services could boost or lift their mood.
The ASA has today banned Klarna from using the marketing ploy and warned the four influencers against any repeat. It acted following a complaint from Labour MP Stella Creasy who previously led the attack against rip- off payday loan firms such as Wonga. Money Mail highlighted the fact the ASA was investigating Klarna’s use of social influencers last week. Klarna said: ‘We recognise that while we had the best of intentions, we missed the mark with the four posts the ASA looked into.’
The influencers denied promoting Klarna’s services as a route to improving mood – rather, they said there were benefits in using skincare products and getting dressed up.
AFTER the collapse of Wonga, we now have ‘buy now, pay later’ lenders exploiting the misery of the pandemic to lure young people into debt.
One, Klarna, has been reprimanded by advertising watchdogs for encouraging millions of customers to lift their spirits by putting on tick a lifestyle that many cannot afford.
Used sensibly, such schemes l et consumers split the cost of new clothes or beauty products over a fixed period.
But the firm hired glamorous social media stars to flog unregulated credit to youngsters facing financial and mental health problems – potentially ruining their futures. The cynicism is breath-taking.
Yes, this paper believes strongly in the free market. But it is reprehensible to abuse that freedom to take advantage of society’s vulnerable.