Fintech

Klarna Revives IPO Plans With $14 Billion Target | PYMNTS.com

Published

4 days ago

August 26, 2025

Swedish digital bank/pay later provider Klarna has reportedly resurrected its plan to go public.

The company is aiming for a valuation of between $13 billion and $14 billion with its U.S. initial public offering (IPO) next month, Reuters reported Tuesday (Aug. 26), citing two sources familiar with the matter.

Klarna announced March 14 that it filed to go public with the Securities and Exchange Commission (SEC). But weeks after the announcement, the company, like several other FinTechs, put its IPO plans on hold following the market shakeup triggered by widespread U.S. tariffs.

The company had also looked at going public in 2021 but decided not go forward with that plan.

A spokesperson for Klarna declined to comment when reached by PYMNTS.

According to the report, sources said the shares sold in the offering could be priced at between $34 and $36 as early as this week.

As Reuters notes, this would be a significant drop from the valuation of almost $50 billion Klarna had targeted in 2021, and the more than $15 billion it was reportedly aiming for earlier this year. One of the sources told Reuters Klarna is aiming to raise nearly $1 billion from the IPO.

Research by PYMNTS Intelligence shows that Klarna holds the largest share of the buy now, pay later (BNPL) market in the U.S. at 26.2% followed by Afterpay, with an estimated 21.9% share, and Affirm, which has a market share of 19.3%.

The company’s IPO plans come as BNPL offerings remain prevalent in the lives of American consumers, with 43% telling PYMNTS they would cancel a payment or purchase if pay later options were unavailable, and 42.4% saying they’d choose a cheaper product or service.

Additional research shows the plans are popular among people living paycheck to paycheck, with 65% of people who struggle to pay monthly bills reporting that they used BNPL last year. The same holds true for 60% of those who live paycheck-to-paycheck but are able to keep on top of their monthly financial obligations.

“These consumers see more of their paychecks eaten up by increases in housing, grocery and insurance expenses,” PYMNTS CEO Karen Webster wrote last month.

“Splitting a $300 unexpected medical bill or a $400 utility expense across a few pay cycles makes it manageable without taking on revolving debt, borrowing from family or friends, or worse. For these households, installments provide structure and stability amid irregular incomes and rising fixed costs.”

Fintech

AI Model Betting Is the New Fantasy Football | PYMNTS.com

Published

4 hours ago

August 30, 2025

Hrishi

Sports gambling has DraftKings. Political junkies have PredictIt. And now the world’s nerdiest corner — the artificial intelligence (AI) scene — has its own set of bettors, where people wager actual money on whether Google’s Gemini will dunk on OpenAI’s GPT-5 this month.

Forget fantasy football, this is fantasy machine learning.

People are placing their bets on markets like Kalshi, where they can trade on the outcome of real-world events, everything from when Taylor Swift and Travis Kelce will wed to whether Google will break up and, of course, the AI model race. Kalshi saw 10 times the volume on AI trades compared with the start of the year, according to The Wall Street Journal.

“Kalshi’s markets are extremely efficient and serve as a source of truth on the likelihood of all events, including AI model progress,” Jack Such, a spokesperson for the company, told PYMNTS.

So who’s winning based on the bets?

“Gemini is the current market leader for ‘Best AI’ by the end of 2025,” Such said.

On Kalshi, Gemini shows a 58% probability of winning, compared with 19% for ChatGPT, as of midmorning on Thursday (Aug. 28). The third spot goes to Grok, at 17%. Claude, which Menlo Ventures said was the enterprise favorite, clocks in at 2% and tied with Meta’s Llama.

The total trading volume reached $8.1 million.

Kalshi is just one of several platforms that are pivoting to AI trading.

Other players include Polymarket, an offshore crypto-based prediction market, Manifold Markets, Metaculus and other sites.

Which AI model is winning globally? The AI community abroad agrees with the Americans. Polymarket, which is only available to non-Americans, predicts that Google will win by year’s end, at 66% odds. OpenAI comes in at 16% probability while xAI is third with 14%.

See also: Crypto Firms Grapple with Bank-Like Risks, Without the Regulation

Betting on Anything in the World

How Kalshi works: People bet yes or no on outcomes in the real world, such as whether the Fed will cut short-term interest rates by 25 basis points in September (76% probability it will) or who will win the Nobel Peace Prize (Yulia Navalnaya, widow of Russian opposition leader Alexei, is at 20% probability and Donald Trump at 10%).

Bettors buy contracts tied to these outcomes at prices between a penny and 99 cents, settling at $1. For example, if a bettor buys a contract for 40 cents and they guess the outcome correctly, they are paid $1. If they guessed wrong, they lose their 40 cents. Bettors can also sell the contract before there’s an outcome if they see the contract price go up or down.

In a tie, the default would be a negative outcome.

For AI models, results will be determined by the rankings on the LMSYS Chatbot Arena Leaderboard at the end of the year, according to Kalshi.

Currently, the leaderboard shows Gemini 2.5 pro slightly ahead of GPT-5 for first place, followed closely by Claude Opus.

One Kalshi user noticed a tie earlier this month and wrote, “it’s a tight race on LMArena. I don’t understand why the spread is so drastic. Huge earnings for people who bet on GPT with decent odds that it will flip.”

Kalshi began allowing bettors to trade on AI models in 2023. “We were confident in consumer demand for these products because of the rapid growth of AI and the economic and political consequences of model progress,” Such said.

Kalshi said the U.S. Commodity Futures Trading Commission regulates it as a financial exchange for trading futures, swaps and options on commodities.

“Understanding that Kalshi is regulated … helps reassure users that they are engaging with a platform that adheres to the highest standards of operation and accountability,” the company says on its site.

Here’s to hoping the bet will be good.

Read more:

Cross-Border Payments Platform Wise Proposes Moving Stock Market Listing to US

Ripple Prepares to Bring Stablecoin to Global Exchanges

FTX Drops Plans to Resurrect Fallen Crypto Exchange

Fintech

Chinese Money Laundering Networks Flagged as ‘Severe Threat’ by FinCEN | PYMNTS.com

Published

1 day ago

August 29, 2025

Hrishi

The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) has issued a warning that Chinese money laundering networks are now among the most significant threats to the U.S. financial system, fueling operations of Mexico’s most powerful drug cartels.

In a new advisory released Thursday (August 28), FinCEN said groups including the Sinaloa Cartel and the Jalisco New Generation Cartel are increasingly using Chinese money laundering networks to clean billions in drug proceeds. The networks have become effective partners because they can move cash quickly, absorb losses and leverage demand from Chinese nationals seeking to bypass Beijing’s strict currency controls. By pairing cartel dollars with Chinese demand for U.S. currency, these networks have created what FinCEN called a “mutualistic relationship” that strengthens both sides.

The 15-page report outlines how these networks operate. They rely on informal value transfer systems, “mirror” transactions and trade-based money laundering schemes to shift funds across borders without physically moving cash. Some recruit Chinese students in the U.S. to act as money mules, depositing cartel cash into U.S. bank accounts and disguising the flows as tuition or living expenses. Others purchase electronics, luxury goods, and real estate with illicit funds, later reselling or exporting those assets to create the appearance of legitimate commerce.

“Chinese money laundering networks are professional money launderers that play a vital role in laundering the cartels’ drug proceeds in the United States,” the advisory said. “This is due to the speed and effectiveness of their operations, as well as their willingness to absorb financial losses and assume risks for the cartels and other clients.”

The advisory also lists “red flag” indicators for financial institutions, ranging from students depositing unusually large sums of cash to small businesses with outsized luxury goods transactions. FinCEN urged banks to reference the identifier “CMLN-2025-A003” when filing suspicious activity reports, and to pay special attention to transactions tied to unlicensed money service businesses, informal transfer systems and trade-based schemes.

FinCEN’s move follows a January executive order that designated several cartels as foreign terrorist organizations, underscoring the administration’s concern that cartel financing now poses not only a criminal but also a national security threat. The advisory ends with a reminder that financial institutions are on the front line of detecting suspicious flows and that voluntary information sharing under existing safe harbors can help expose networks that otherwise thrive in the shadows.

Fintech

Revolut Considers Hiring Advisers on US Banking Acquisition | PYMNTS.com

Published

2 days ago

August 28, 2025

Hrishi

U.K. FinTech Revolut is reportedly getting closer to entering the U.S. banking space.

The company is mulling hiring investment bankers to advise it on a possible acquisition of an American lender to bolster its growth in the U.S., Bloomberg News reported Thursday (Aug. 28), citing sources familiar with the matter.

One source told the news outlet that Revolut is still deciding between an acquisition or applying for its own banking license, and that these deliberations are happening as the company readies the launch of savings products for U.S. consumers in the weeks ahead.

The report follows a similar story from the Financial Times late last month, which said Revolut was considering the acquisition of a U.S.-chartered bank. A spokesperson for Revolut declined to comment when reached by PYMNTS.

As the Bloomberg report notes, Revolut has operated for years in the U.S. by collaborating with other banks. But now, the company and its competitors are seeking a greater share of the banking space amid a more relaxed attitude toward financial regulation in Washington.

Revolut is still in the process of establishing its banking presence in its home country. It took the FinTech more than three years to land a U.K. banking license, and while it eventually secured that permission, it must operate under certain restrictions. Per Bloomberg, Revolut has said it’s in the closing stages of this process.

“Given Revolut’s global scale, this is the largest and most complex mobilization ever undertaken in the UK,” the firm said in a statement last month. “A thorough review is an expected part of the process and getting this right is more important than rushing to meet a specific date.”

Revolut CEO Nik Storonsky has said that the company’s “grow fast” ethos had been ill-advised because a smaller firm would have been able to obtain licenses more easily than one the size of Revolut.

Meanwhile, last month saw a report that the British government and the U.K. central bank had suffered a “falling out” due to delays in allowing a full banking license for Revolut.

Bank of England Gov. Andrew Bailey denied that report, saying the central bank and British treasury have a good relationship.