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Insights and Expertise

It made a simple, visible offer at the exact moment of pur-
chase: you only need to pay one-third now.

Partnering with major retailers like H&M and Nike, it ap-
peared on the product page at the moment of decision and
onboarding as part of the checkout flow, giving consum-
ers easy access and trust by association with consumer
brands they knew.

That strategy worked. Klarna scaled from 10 million users
in 2013 to over 100 million today, with reach across 26+
countries. Merchants bought in because Klarna increased
Stablecoins at checkout: basket sizes and conversion rates. Consumers bought in
because of the credit on offer, and the easy process of sign-
What's stopping mass up.
Contrast that with Open Banking. It's technically efficient
and cheap for merchants but slow to gain traction in B2C,
adoption? largely because consumers don't understand what it's bet-
ter than cards.

By Chris Jones For stablecoins to succeed, they'll need to follow Klarna's
PSE Consulting lead:
• Be visible at checkout, not buried in the background
t's easy to get caught up in the hype: stablecoins
as the next big thing in consumer payments. Fast, • Offer a clear, simple benefit to the consumer
low-cost, digital-native, and supposedly ready to • Prove they can boost conversion or loyalty for cards
I challenge the traditional world of cards, wallets and not just cut costs
BNPL.
Without merchant buy-in and brand awareness at the
But for all the headlines, the reality on the ground is more checkout, stablecoins will remain niche.
muted. Right now, stablecoins are barely registering in
the B2C payments mix. And it's not because of regulation, Consumer incentives: Show me the rewards
volatility or technology. It's something much simpler: con-
sumers don't see the point. Consumers are used to being rewarded when they pay,
particularly in the United States. In the U.S., credit card
So, what's missing? And what would it take to make sta- cashback averages 1.6 percent. In Europe, it's lower, around
blecoins a credible choice at checkout? 0.25 percent, but still part of the everyday value equation.

Lots of ways to pay, no reason to switch Stablecoins, by contrast, currently offer ... nothing. That's a

I'll start with the obvious: consumers already have a lot problem. But it's also an opportunity. The real incentive to
of ways to pay. Cards work. Apple Pay is fast. Klarna and switch lies in the cost savings stablecoins unlock for mer-
BNPL services offer flexibility. Loyalty points, cashback chants, which can be shared back with the customer.
and seamless UX are built in. In short, the current sys-
tem just works, which makes it hard for any new player to Take a look at our modeled examples in Figures 1 through
break through. 3 (using USDC as a case study, scheme fees and gas fees
omitted for clarity).
To succeed, stablecoins need more than low processing
fees. They need:
• Consumer understanding and visibility
• A compelling reason to switch
• A smooth customer payment experience

None of those is in place today.
Learning from Klarna: Visibility matters

When Klarna burst onto the scene, it didn't start with an
abstract pitch about lower costs or backend infrastructure.

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