Klarna & SOFORT by Klarna

The right Payment mix: Why is it important?

Finding the right payment method mix enhances customer experience, increases the likelihood of completed transactions, and contributes to the overall success and growth of your online ticket shop.

More specifically, it is important to consider the following:

1. Customer Preference: Different customers have different preferences when it comes to payment methods.  Offering a variety of payment options ensures that you cater to a broader customer base and don't turn away potential buyers who might abandon their carts if their preferred payment method is not available.
   
   

2. Security and Trust: Providing well-known and trusted payment methods helps build confidence among your customers. Many shoppers prefer known payment methods and added a layer of security. This trust can lead to increased conversion rates and repeat purchases.
   
   

3. Reduced Cart Abandonment: Complicated or limited payment options are a common reason for cart abandonment. If a customer doesn't find a convenient way to pay, they might abandon their shopping carts. By offering a diverse range of payment methods, you can minimize the chances of customers leaving your site without completing a purchase.
   
   

4. Mobile Optimization: As more people shop using mobile devices, it's crucial to have a payment mix that is optimized for mobile transactions. 
   
   

5. Compliance: Different regions may have specific regulations regarding online payments. Ensuring that your payment methods comply with relevant regulations helps avoid legal issues and builds a positive reputation for your business.
   
   
   

Who chooses the payment methods we offer in our ticket shop? 

The short answer: You do!
You are fully in charge of choosing your online payment methods from the available options. 

How does Convious support us here?

Core to our partnership is for you to see Convious as your trusted advisor. We are happy to provide you with insights derived from industry experience, market best practices and, in most cases, your own data. 

With this, the responsibility also lies with you to ensure you are choosing the option most suited for success.

In our advisor role, we want to make sure you can make an educated choice. This is why we're making information available to you to do so when it comes to Klarna and SOFORT by Klarna.

Klarna & SOFORT by Klarna 

To explain better how the payment and fund transfer process works, here is a short summary of both of these payment methods:

Klarna is a buy now, pay later service that allows users to make online purchases and pay for them in installments. It provides consumers with flexibility in payment while offering merchants immediate funds for the transaction.

As you can see, the sales process is very straightforward. However, a clear distinction that needs to be made is that Klarna is not just a method that enables the sale; all actors, despite the end customer, become sellers in this payment flow. 

The fund transfer/payout will be the same process in reverse:

SOFORT is a bank transfer initiation service requesting a shopper's bank credentials and executes the payment at the shopper's bank using 'screen-scraping' technology.

The Risk: Sofort is not a guaranteed payment method. This means the settlement can still fail as they do not, as opposed to guaranteed payment methods, provide a seller with a guarantee of payment for fraudulent transactions.

What if a customer fails to transfer the funds using SOFORT?

Suppose a customer does not have sufficient funds to transfer the owed funds to Klara, which can be due to numerous reasons ranging from bad housekeeping to intended fraud. In that case, the fund retrieval falls back on the last in the chain as follows:

What is the consequence of this?

As you can see above, the result is this can lead to you having to bear the unpaid fees while the customer holds and may already use their tickets. 

Given the period that is required for Klarna to make a final conclusion on the fact that the funds will not be received from the end customer, up until you are requested to pay for the funds, it is often longer than the lead time (time between purchase date and visit date), this can result in customers holding valid tickets they did not pay for. 

The Status or Record Type of the transaction will be called a Chargeback.*

Please note:
1. This is a standard process that Convious, nor the PSP can influence.
2. This does not mean this is easy to exploit and will be exploited at all times. However, it is a risk that this payment method comes with we want you to be aware of. 
3. For credit cards, chargebacks work differently.

Where can we see the Chargebacks related to Klarna?

To monitor the above, you can use the Settlement Report by using the following filters:

 

<- Depending on your location

Making an educated decision

Knowing all this, you may want to ask yourself:

• Is this your most used payment method, and in relation to the cases of non-received funds, you are gaining more from it than you lose? 
  → Then this may be a risk that is worthwhile taking when treated consciously. 
  
  
• Are you losing out on more business in relation to what the payment method brings in?
  → Then, this may be a risk you want to remove. 
  
  Remember: It is up to you to make this call. 
  
  

Potential alternatives

An alternative option that delivers comparable advantages to your end-customers would be PayPal, as they, too, offer additional security and payments in installments for specific regions.

Disclaimer: The information presented is derived from expert sources within the market, and while we strive to provide accurate and up-to-date content, partners are advised to verify the latest details directly from the respective providers. We do not assume liability for any inaccuracies or discrepancies in the information provided, and users are encouraged to independently confirm information from the official sources for the most current and reliable data.