I dont know anything about Klarna so hard for me to comment specifically. It seems
Klarna's fees = Interchange (IC) + 10bp
- are scheme fees excluded from the 10bp? Or is it IC + 10bp + scheme.
- what about a card not present per transaction fee (these will almost always exist). So now its 'IC + 10bp + scheme + fixed fee'
If thats what they do, and they take the repayment risk (ala AFY) then those margins (10bp) are stupidly thin (unless they charge a massive fixed fee which is highly unlikely). I suspect there is something missing in your assessment.
AFY fees = Fixed Rate (ie, 5%). I could assure you that AFY know their margin above IC as that is a main driver in their GP calcs (i reckon acquiring costs should be in COGS for AFY). Essentially, GP for AFY should be 'TTV * (fixed rate less cost of acquiring)'
A merchant, as
@ValueTrader82 said, may pay a max of around 1.2% (depending on bank's margin). So essentially, the merchant (ie, CountryRoad) would effectively be paying AFY 3.8% to take on the repayment risk.
AFY are talking with Tiro in regards to the Card Present world (ie, terminals). If I went to a shop (ie, countryroad) and went to pay for my jumper (lets say $50) and they offered AFY and didnt charge me a surcharge for and AFY transaction, id be asking for a discount by not using AFY. Why should I be subsidising AFY users?
I can see AFY rising on hype and expansion. But once the penny drops and the ongoing profitability struggles to justify the market cap, we'll see a drop. I am thus Short term positive on the stock with a medium/long term negative.
