PayPal and KKR have signed a new agreement that will allow the credit funds and accounts managed by the investment firm to acquire up to €65bn ($75.5bn) in European buy now, pay later (BNPL) loan receivables from PayPal in Germany, France, Spain, the UK and Italy.
This agreement, which includes a replenishing loan commitment of up to €6bn, builds on their collaboration, established in June 2023, which saw credit funds and accounts of KKR purchasing the majority of the payments firm’s European BNPL receivables.
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PayPal chief financial and operating officer Jamie Miller said: “Our continued partnership with KKR reflects the ongoing success of our European buy now, pay later business and our disciplined approach to balance sheet management.
“The enhanced terms of this new agreement will support the ongoing growth of our BNPL portfolio in Europe. It demonstrates our commitment to a balance-sheet light model for credit that helps preserve flexibility for strategic investments and capital return.”
PayPal said that it will retain responsibility for all customer-facing functions related to its European BNPL products, including servicing and underwriting. The transaction’s debt was arranged by KKR Capital Markets.
KKR managing director Vaibhav Piplapure said: “We are pleased to continue supporting PayPal, which has built a strong and high-quality BNPL platform in Europe, as it continues to grow in this important market.
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By GlobalData“This expanded commitment underscores the scale and versatility of KKR’s global Asset-Based Finance (ABF) platform.”
According to PayPal, the agreement was already accounted for in its fourth quarter (Q4) and full year 2025 guidance for GAAP and non-GAAP earnings per share, as well as non-GAAP transaction margin dollars as disclosed in late October 2025.
In Q3 of the financial year 2025 (FY25) ending 30 September, PayPal reported a 7% increase in GAAP and non-GAAP net revenues to $8.4bn, compared to $7.8bn in Q3 2024.
Recently, PayPal introduced a fee-free BNPL service for Canadian consumers. The “PayPal Pay in 4” solution allows shoppers in Canada to divide eligible online purchases valued between C$30 ($21.3) and C$1,500 ($1,067.7) into four payments over six weeks, without any additional charges such as late fees or sign-up costs.
