Klarna adds pay-later options to FreshBooks invoices for small businesses in the US and Canada

Klarna and FreshBooks announced on 21 October 2026 that Klarna's payment options are being built into FreshBooks' invoicing and payment flows for small businesses in the United States and Canada. Customers who receive a FreshBooks invoice can pay in full, split the amount into four interest-free payments, or finance it over a longer period. According to the companies, businesses do not need any extra setup to switch it on. Digital Transactions reports that Stripe handles the integration behind the scenes. The companies gave the example of a tradesperson or a garage letting a customer spread a medium-sized repair bill over several payments. This matters because it pushes pay-later beyond e-commerce checkouts into invoices, where small service businesses have traditionally waited for cheques, bank transfers or one-off card payments. For the business, the main gain is getting paid in full up front while the customer pays in instalments, with Klarna typically carrying the credit risk. The release does not give the fee that FreshBooks users will pay for Klarna transactions, which is usually higher than a standard card fee. It is also another example of Klarna growing through platforms and processors rather than one merchant at a time. When pay-later is switched on inside software that many small firms already use, adoption can happen quickly and with little deliberate choice by the business, so it is worth knowing what has changed in the payment options customers see.