Klarna and Modo announce a new strategic partnership

Under the terms of this new partnership, Modo will provide Klarna with its Digital Payments Hub product to speed up implementation of Klarna’s checkout solution for their worldwide e-retail partners. This hub enables the Richardson, TX startup to make value conversions (monetary, loyalty or otherwise) between disparate systems without changing existing infrastructure.

The hub utilises Modo’s patented COIN® transaction system to manage the complexities of payments systems integration “by connecting them and mediating the differences between processes.” The COIN® provides transaction services that include: accounting, settlement, compliance, transaction management, and risk management. Thus the Digital Payments Hub is often referred to by Modo as being “COIN® Operated” which is a new and branded way to signify their product in partnerships.

Ultimately, the outcome of this partnership is that Klarna will be able to integrate their high conversion ecommerce checkout solution with their e-retail partners faster. In their pilot with Klarna, Modo was able to achieve a transaction exception rate of one tenth of a basis point.

Modo’s payment hub could decrease the number of people required to manage these anomalies by two orders of magnitude. This means, according to Parker, that connecting dissimilar financial systems is no longer cost prohibitive for many types of financial institutions, and the team is already planning to make this service available to multiple banks in short order.