Klarna's decline is almost perfectly mirrored by its US-listed rival Affirm Holdings Inc., whose market value has tumbled from a $46.8 billion peak in November to about $6.1 billion. Consumer credit startups are contending with their first experiences of soaring inflation, higher rates and looming recession pressures that could cause defaults to spike. Unlike more established banks, they do not have other income sources such as trading desks or home loans to counterbalance a fall in discretionary spending. Buy now, pay later firms are also facing increased regulatory scrutiny.