Swedish startup Klarna has raised USD 650 million and become Europe’s highest valued fintech company, as investors valued the company at USD 10.6bn.

СNBC reports that the investment round was led by Silver Lake Partners, alongside Singapore’s sovereign wealth fund (GIC), and other investors.

Klarna operates since 2005. It started as an online payment service and received a banking license in 2017. Klarna co-founder Sebastian Siemiatkowski told that the business was based on the solution for mistrust between online stores and buyers.

E-commerce was just emerging in many countries in the early 2000s: the buyers were concerned about paying online and the stores were concerned about sending the purchases without pre-payment. Klarna performed as the intermediary, working by a factoring model that was adapted to e-commerce.

To date, the Klarna app has more than 12 million monthly active users worldwide, with 55,000 daily downloads, which the company claims is almost three times as many downloads as its closest competitor over the last year.

“We are at a true inflection point in both retail and finance. The shift to online retail is now truly supercharged and there is a very tangible change in the behavior of consumers who are now actively seeking services which offer convenience, flexibility and control in how they pay and an overall superior shopping experience,” Sebastian Siemiatkowski said.

Klarna is experiencing rapid U.S. growth as the country continues to feel the effects of the Covid-19 pandemic. As a result of the accelerated switch to online retail and evolving consumer preferences, the company has added more than 35,000 new retailers during the first half of 2020 to its network of more than 200,000 retail partners, including Sephora, Groupon and Ralph Lauren.

A recent McKinsey & Company consumer survey found that more than 75% of consumers have tried new brands, places to shop or methods of shopping throughout the pandemic. Additionally, 82% of those who have tried a new digital shopping method intend to continue using it even after returning to some semblance of normal. For Klarna, that’s resulted in volume and revenue growth of 44% in the first half of 2020, and 36% year-over-year to more than $22 billion and $466 million respectively.

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