Klarna, the Swedish fintech firm best known for its buy now, pay later offerings, said Monday it applied to federal and state regulators to establish a U.S. bank subsidiary.

The firm said that, if approved, Klarna Bank USA would be a Federal Deposit Insurance Corp.-backed institution chartered in Utah. The proposed bank would be led by Gary Harding, former CEO of Milestone Bank and Prime Alliance Bank, according to Klarna.

“We’ve seen firsthand the appetite for a fairer, more transparent approach in the U.S., and our own banking license is the natural next step,” said Sebastian Siemiatkowski, co-founder and CEO of Klarna.

The move will give “customers tools to borrow responsibly and build financial confidence, while bringing greater competition, innovation, and choice” to the market, he said.

Klarna’s application is the latest sign that fintech firms, which mostly partner with U.S. banks to offer services, now see owning their own charters as a key advantage. In April, fintech provider Mercury said it won conditional approval to establish its own bank, joining a wave of fintech and crypto firms seeking entry to the traditional banking system.

Klarna said that its charter, if approved, would let it bring its banking operations in-house and strengthen reliability across payments, credit and merchant services.

The application marks Klarna’s latest step toward becoming a broader consumer bank rather than just a buy now, pay later provider. Last month, Klarna introduced high-yield savings accounts to U.S. customers, though its partner WebBank holds those accounts. 

By owning a bank, fintech firms can fund loans with their own customer deposits instead of more expensive wholesale financing, directly offer checking accounts and credit cards and rely less on third-party banking partners.

Klarna, which went public last September, is trading for about half of its initial public offering price of $40.