RNDpoint FinTech Development Company
Home BNPL App Development How much does it cost to develop BNPL apps like Klarna?

How much does it cost to develop BNPL apps like Klarna?

(13 min)
Peter Shubenok
Managing Director

Today’s consumers look for convenient, safe, and profitable ways to pay for purchases. One of them is BNPL. Its popularity is growing rapidly. Juniper Research reports that 360 million people used it in 2022. It is predicted that by 2027 the number of users worldwide will increase by 157%, reaching 900 million people. 

Given this context, BNPL app will open up unique opportunities for you to maximize your profits. In this article, we’ll explain the essence of BNPL and how to successfully implement a startup project.


Brief guide to Buy Now, Pay Later

BNPL is among the brightest trends in finance and banking. The idea is that customers can pay for their online purchases in equal installments over a short period of time. 

How is this different from the installment plan everyone is used to? These methods are similar, but there are unique features as well. Let’s break them down to get a deeper understanding.

Installment – a classic banking product

The client must sign a contract to use borrowed funds. The bank considers the client’s solvency and credit history and only then makes a decision.

Within a set amount, the bank lends money to the client for a certain period. The total debt for this period shall not exceed the limit. An installment loan is similar to a credit line with a long grace period (when credit funds are used without interest).

BNPL – a modern way to pay for online purchases

This is not a loan product. The client does not enter into a contract, as with a loan and installment plan. Your credit history is not checked, and there is no need to issue a separate card.

The cost of a single purchase is broken down into several parts. Typically, the BNPL app offers 0% or cashback. The service makes money by charging 1-3% commission per transaction. As you can see, the business model is simple and has low costs for the business owner.

The BNPL scheme benefits all parties:

  • A store attracts new customers, increases basket conversion rate, and increases average order size.
  • A customer receives the product after the first installment and pays installments with no hidden fees or interest.
  • A provider sells future payments to a lender at a discounted rate ($100 to be received in 6 weeks, sold for $96).

Usually, the provider is a financial startup or a bank. In the latter case, the BNPL can be an add-on to the card. Consequently, the bank sees data on the customer’s previous payments and account balances.

  • If the provider is not a bank and the above data is missing, the financial risk is still not high. The reason is that the amount is insignificant (purchases with a small and average check).

Interested in mobile payment app development? Then it will be useful for you to learn about the specifics of such an app and market trends.


How does the BNPL app work, and why is it popular?

The digital service is an intermediary between the seller and the customer. It offers an entirely seamless payment process. Thus, the mechanism is built into the app, making the user experience as convenient and simple as possible.

Let’s look at how the buy now pay later app works:

  1. The user opens an account linked to their card (credit/debit).
  2. The user chooses the BNPL payment method to purchase a $100 item from the store.
  3. The BNPL provider reviews the user’s credit rating (usually a soft check).
  4. The provider confirms the transaction, and $96 is immediately paid to the merchant from the $100 amount.
  5. The customer pays the provider a down payment of $25.
  6. The transaction is processed by the payment gateway and goes through Visa/Mastercard (for a fee).
  7. The client receives the goods ordered in the store.
  8. The client returns the money to the provider according to the schedule: every 2 weeks, the amount is deducted from the card and processed by the payment gateway.

Thus, the customer receives the product after making a down payment rather than the full amount. This method of payment became very popular during the pandemic. According to C+R Research, 51% of consumers paid for their online purchases this way during this period.

The BNPL app was viral among tech-savvy young people. According to an eMarketer survey, as many as 44.1% of Generation Z and 37.2% of U.S. millennials used these services in 2022. In 2025, those numbers are expected to rise to 47.4% and 40.6%, respectively.

BNPL use by different generations (2021-2025)
Fig. 1. BNPL use by different generations (2021-2025). By 2025, BNPL usage among Gen Z is anticipated to be about 50%. Source: Exploding Topics

The spread of online shopping (including because of the pandemic) and the demand for BNPL among young people are the main drivers of market growth. The rapidity of its development is truly impressive.

Precedence Research reports that in 2021 the global market was $125.09 billion. It is projected to grow at a CAGR of 43.8% to reach $3268.26 billion over the period 2022-2030.

BNPL Market Size, 2020-2030 (USD Billion)
Fig 2. BNPL Market Size, 2020-2030 (USD Billion). Source: Precedence Research

Other factors also contribute to the development of the market on a global level:

  • Active integrations of artificial intelligence and machine learning technologies.
  • Strategic collaboration of large companies to strengthen competitive positions.
  • Mass use of digital payment technologies (debit/credit cards and mobile payments).

We have a lot of experience in FinTech, and we are sure that this market will not slow down in the next decade. That means you should think seriously about payment app development. Implement your ideas with Software Engineering Services by RNDpoint.

To get a deeper understanding of the business model, we recommend taking the successful experience of a large company like Klarna as a basis.


Klarna as an example of a top BNPL app

Klarna is a Swedish FinTech company offering online financial services. Among them are in-store payments and direct payments, as well as post-purchase payments. 

Klarna was founded in 2005 to make online shopping easier. Even with the advancement of technology, its mission has remained the same: to provide easy, secure, and seamless payments. 

H3 How popular are Klarna’s services?

According to internal company statistics, there are 150,000,000 consumers and more than 450,000 salespeople. That’s on a scale of 45 countries. Users make 2,000,000 transactions a day.

What are the features of the Klarna app?

The company offers a universal shopping app that has features such as:

  • Exclusive offers and bonuses from various brands.
  • Notifications about price reductions on selected products.
  • Order delivery tracking and returns control.
  • Storage of all loyalty cards in one place.
  • Rewards (one point for every dollar spent).
  • Deferred payments on purchases on Pay Later in 4.

To start working with the app, the user must install it on their smartphone (from the App Store/Google Play) and confirm their identity.

How does Pay Later in 4 work?

The online payment service allows the buyer to get what they want today and pay for it in the future. The purchase price is divided into 4 payments, which are withdrawn every 2 weeks.

How Pay Later in 4 works:

  1. A buyer uses a debit/credit card or another convenient payment method (no prepaid cards).
  2. The first payment is deducted after a seller confirms the order (usually the shipping date for online orders).
  3. The next 3 payments are automatically deducted every 2 weeks (after the first payment).

There is no interest or surcharge for failing to make a payment. A late fee (up to $7) is charged if the payment is still unpaid after 10 days. Also, the buyer’s financial institution may charge interest/commission depending on the payment method.

This service does not affect the buyer’s credit rating due to the soft credit check.

How does Klarna make money?

The company primarily charges the seller rather than the consumer to generate revenue.

Main sources of income:

  • Payment fees. This fee comes from merchant transactions as well as variable percentage fees.
  • Interchange fees. A company has implemented a bank account with the issuance of a Visa debit card. When a user purchases with this card, the merchant pays an interchange fee to the issuer. Klarna keeps a portion of the fee in exchange for promoting Visa.
  • Cash interest. The bank account discussed above also earns cash interest on these accounts. This is done by lending it out to other institutions.

There is a retailer fee for Pay in 4 installments. Retailers pay a fee every time a user makes a purchase in their store or Klarna app. The fee depends on the country.

How does Klarna protect customers’ money?

The company guarantees users uninterrupted Internet service and protection against fraud. 

Here are some protective measures:

  • Risk engine. Checks the buyer who places the order and third-party suppliers.
  • Identity Checks. Customer Identity and Address Checks against external data sources, including soft/hard solvency checks.
  • Authentication Checks. Examine additional information about a customer’s identity, such as knowledge-based challenge questions.

If fraud is detected, the company stops the transaction and does everything possible to secure the data. It also stops the delivery process and intercepts packages.

What is similar to Klarna?

G2 highlights such apps like Klarna (based on their reviews):

  • Sezzle
  • PayPal Credit
  • Affirm 
  • Afterpay
  • Zip
  • Splitit 
  • PayPal 
  • GoCardless
  • ViaBill 
  • FuturePay 

Do you want to create a mobile app that your target audience will love? Pay maximum attention to its functionality.


Main features of Buy Now Pay Later app

We have highlighted their key features based on our experience in creating BNPL solutions.

Transparent commissions

According to the PYMNTS survey, 41.8% of respondents appreciate the clarity of fees or interest rates. Your job is to make the product available to all customers. Retailers, for their part, need to be aware of the fees they pay on every customer transaction.

Cost control

People try to control their spending. Usually, the amount owed does not exceed $100-250 but sometimes goes up to $1,000-2,500. Inform your audience about all the terms of the BNPL, including the limits and intervals for repayment.

Applying for payment in installments

Allow the customer to place an order in minutes, whether at the point of sale or online. Confirming a transaction doesn’t take long. And the customer doesn’t need to fill out any documents. Everything happens digitally right from the mobile device.

Secure payments

Ensure speed and reliability of payment processing. Integrate the app with a proven payment gateway such as Stripe and Visa/Mastercard. Also, automate the process of regular customer debits.


Only verified users should have access to transactions. Take a company like Klarna as an example and implement Identity Checks and Authentication Checks. Also, take measures to prevent payment fraud.


Sometimes users make many purchases at once or choose expensive products. More than 55% of users admit they regretted the purchase because of its high cost. Give a return on products and the money invested in them.

Control Panel

Give verified users access to purchases of goods and services, payments, and personal data. Ideally, the app should have tools for analyzing purchase history, controlling expenses, and tracking the delivery of orders.

Rewards Program

Develop a referral program to reward your audience for certain actions. For example, bonuses for recommending the app to friends, for the activity of invited users, or for many purchases.


Each user of your BNPL app should always be aware of their current financial situation. The app must notify them of payment deadlines, overdue payments, the amount owed, and late fees.

Mobile payment app development with such features is a step-by-step process that requires a serious approach.


Stages of payment app development

Bring your business idea to life in 7 steps:

  1. Generating an idea and a concept. What is the idea behind the app? How will it be different from the competition? What value will you offer? Answer these questions at the start and develop the concept.
  2. Target audience analysis. Study potential users: average age, place of residence, financial situation, preferred devices, desired payment terms, etc. Based on these indicators, you can draw a portrait of the user.
  3. Build a strategy. Based on the data obtained, prioritize the functions. We recommend ordering the development of a basic version to test the idea in practice. 
  4. Hire a developer. Set a goal and created a business strategy? It’s time to look for an IT team to implement your project. Use business listings (Clutch), freelance platforms (Upwork, Fiverr, Toptal), online meetups (OnlineGeniuses), etc.
  5. Business analysis and planning. This is the preparatory stage before development. The business analyst collects the requirements and makes a plan. Based on these requirements, form a team and select the stack (Swift, Kotlin, Java, CI/CD, AWS Lambda, etc.).
  6. Development and testing. The team carries out a set of works: UI/UX design, backend, frontend, and integrations. Testing is performed before deployment to ensure quality.
  7. Marketing. There are different ways to increase awareness: advertising on social networks, email marketing, and promotion in search engines. Hire marketing experts and SEO specialists.

The finished product requires a lot of attention, too. Provide maintenance and support to ensure smooth processes. Remember that the app must scale and improve as your business grows.

Planning to order Buy Now Pay Later app development? Ask RNDpoint consultants about the cost of the project in advance.


The cost of BNPL application development

The cost comprises many elements. Foremost, these are the product features, the project’s scale, complexity, tech stack, and time constraints. But do not forget about such important factors as the size of the team and the hourly rate of developers (it depends on the region).

For example, let’s calculate the cost of creating an app with basic features. Let’s say a mobile developer from Eastern Europe was involved. Then the hourly rate will be $41-60.

FeaturesTime (hours)Cost ($)
User profile903,690
Money refund401,640
Control Panel1405,740
Notification system502,050
Referral system451,845

The typical rate for working with a Middle Specialist is $41-60, and the typical rate for a Senior Specialist is $61-80. Keep in mind that it may be more expensive in other regions. A Middle developer in North America charges $61-80 for their services, and a Senior developer charges $81-100 or more. 

It is also important to understand that this applies to an app for one OS. The cost can double if your goal is to develop an application on two platforms.

When calculating a project’s total cost, consider the timing and rates for other services: BA, QA, and PM. You can ask them directly from the outsourcer. Choose a company with flexible pricing that adapts to your financial capabilities.

Contact RNDpoint, and our experts will calculate the cost of your project based on your individual needs.


Why hire RNDpoint for BNPL app development?

Buy Now Pay Later payment solution development is one of our key services. We create complex BNPL products for banks and FinTech startups from scratch and participate in the ecosystem’s service and support. 

One of our large-scale BNPL projects resulted in 30,000+ business partners and 6 million retail users. The product became one of the top products in a large retail bank.

Advantages of BNPL app development with RNDpoint:

  • Impressive experience. We have completed 120+ successful projects for FinTech companies worldwide.
  • Fast and efficient integrations. With our product ProcessMIX, the integration process is 3 times faster.
  • Cost-effective. Creating an app based on an off-the-shelf ProcessMIX solution is half the cost of native development.

Still in doubt whether it’s worth ordering payment app development? Considering the growing interest in BNPL, your solution will always be in demand, so your business development and scaling prospects are almost unlimited.


What is a BNPL application?
What are the most popular examples of BNPL applications?
How is BNPL different from EMI?
What are the main features of BNPL applications?


Peter Shubenok
Peter Shubenok
Managing Director
Talk to expert

We’re always open to new partnerships and ready to help you at any stage of your FinTech project growth.

    By sending this message you agree to our Privacy and Cookies Policy.

    Book a call or text us in Telegram
    UK Portugal Ukraine Sweden Poland Middle East