Visa has agreed to acquire a strategic stake in Swedish payments startup Klarna and form a strategic alliance to expand business footprints beyond their core markets.

Serving 60 million consumers and 70,000 retailers, Klarna provides payment services for online storefronts in Europe.

Financial terms of the deal were not disclosed; however, Klarna plans to issue new equity as part of the transaction.

Visa executive vice president for innovation and strategic partnerships Jim McCarthy said: “Klarna has demonstrated an expertise in consumer credit and online purchasing and together, we share a vision for how today’s online and mobile commerce experiences can be as simple as they are in the real world.

“Visa is committed to partnering with a new generation of partners and payment providers to bring secure, online commerce to many more consumers in Europe. We look forward to working more closely with Klarna to accomplish this.”

Klarna co-founder and CEO Sebastian Siemiatkowski said: “The Visa and Klarna partnership is a natural fit. We both understand consumer credit and the value of consumer centricity in developing innovative payment solutions.”