In what financial historians will surely record as late-stage capitalisms’ magnum opus, your regrettable 1 AM pepperoni pizza Dominos order can now be financed over three convenient monthly installments via Klarna, bundled with thousands of other poor financial decisions, and sold to institutional investors who once considered mortgage-backed securities too risky. Welcome to 2025, where your drunk food cravings have been transformed into an exciting new asset class that Harvard MBAs are calling “the ultimate fusion of tech disruption and questionable life choices.”
Deliveroo, the food delivery platform that somehow convinced us all that paying a £4.99 (About $7 depending on what Uncle Donald Trump decides for the world economy) fee for lukewarm restaurant food delivered by a cyclist who judges your order is a good idea, has partnered with Klarna to offer Buy Now, Pay Later services on all orders. The groundbreaking innovation allows customers to finance their doner kebabs and curries with the same financial instrument previously reserved for Pelotons and Apple iPhone upgrades that nobody needed.1
The Three-Month Pizza Plan: Amortizing Your Regrets
Under Deliveroo’s revolutionary payment model, customers can choose to pay for their food immediately (BORING!), within 30 days (still fairly responsible), or split the cost into three monthly installments for orders over £30 (about $40 bucks – financial self-sabotage with a side of fries!).2 The third option has quickly become a favorite among young professionals who want to maintain the lifestyle of someone earning twice more than they actually do.
“It’s about empowering consumers with flexibility,” explained Carlo Mocci, chief business officer at Deliveroo UK, while carefully avoiding the phrase “enabling poor financial decisions.” “We’re giving customers more choice and more flexibility with a safe, secure way to pay online”.
The partnership has been praised by those who believe the primary barrier to happiness is the inability to finance a bucket of chicken hot-wings over a fiscal quarter. Critics, meanwhile, have called it “the dumbest thing since NFT restaurants” and “a concerning development in our society’s relationship with both debt and saturated fats.”
Personal finance expert Tara Flynn of MoneySavingExpert cut directly to the chase: “If you’re considering buying your takeaway now and paying for it later… don’t. Getting yourself into debt over a meal that’s gone in 15 minutes isn’t worth it”.3 But why listen to financial experts when you can instead listen to the voice in your head at 12 midnight saying “You deserve this Tandoori feast NOW, and deal with the consequences LATER”?
From Your Stomach to Wall Street: The Miracle of Modern Finance
Here’s where the ordinary becomes extraordinary. Klarna isn’t just holding onto your pizza debt like a nostalgic memento. No, they’re packaging it up with thousands of other food debts and selling it to hedge funds and institutional investors through the miracle of securitization – that is where they make their REAL money!4
According to recent reports, Klarna is selling most of its British BNPL loans to American hedge fund Elliott, freeing up an estimated $39 billion for new loans.5 This means your outstanding £36.50 Meat Feast Extravaganza payment is now sitting in the investment portfolio of a US pension fund manager who’s never experienced the existential crisis of adding extra cheese at a Deliveroo checkout.
The structure works similarly to the Domino’s Pizza securitization model, where the company created a special purpose vehicle (SPV) called “Domino’s Pizza Master Issuer LLC” into which it sold its revenue-generating assets.6 In Klarna’s case, the SPV might as well be called “The Repository of Questionable Midnight Cravings LLC,” where your three outstanding payments for chicken wings join forces with thousands of other fast food financing arrangements.
Meet the Pizza-Backed Security: Wall Street’s Tastiest Financial Innovation
Financial analyst Matthew Van Herzeele recently explained securitization on LinkedIn, describing how “bank and fund managers come together to create a special-purpose vehicle (SPV) to hold these assets banks need to unload”.7 In this case, the assets are the digital equivalent of IOUs scribbled on greasy napkins.
What makes food-backed securities particularly innovative is their unique risk profile. Unlike houses, which at least exist for decades, the underlying assets securing these loans have a half-life measured in minutes and an afterlife manifesting as indigestion and obesity. The collateral literally disappears down the customer’s esophagus before the first payment is due.
“It’s fascinating,” explained one Wall Street analyst who requested anonymity because his firm is currently underwriting several chicken-backed security offerings. “We’re essentially creating a financial instrument backed by assets that have negative value after consumption. It’s like securitizing hot air.”
The Tranches: From AAA Sushi to Subprime Nuggets
Just as with mortgage-backed securities, food debt is carefully sorted into risk tranches. At the top sit the AAA-rated sushi orders from affluent neighborhoods with perfect payment histories. In the middle are the BBB-rated pizza deliveries to young professionals who usually make their payments but occasionally need a reminder. And at the bottom are the high-risk, high-yield “subprime chicken nuggets” – the 3AM chicken orders to university dormitories that have a default rate coinciding precisely with student loan payment dates.
One hedge fund has reportedly created an algorithm that assigns risk scores based on not just the customer’s credit history but the specific food ordered. Thai food at 7 PM on a Wednesday? Low risk. Twelve chicken wings, three sides, and two milkshakes at 2:30AM on a Saturday? High risk but potentially high reward if they make their payments.
“The beauty of these securities,” explained a quantitative analyst at a major investment bank, “is that we can predict default rates based on topping choices. Pineapple on pizza correlates with a 23% higher risk of missed payments. It’s the financial equivalent of a red flag.”
The Curious Case of Chicken-Backed Liquidity
The market for food debt securities has grown exponentially since Deliveroo and Klarna first partnered in 2022. What started as a £5.6 billion market has expanded to roughly the size of Denmark’s GDP, driven by an insatiable appetite for both takeaway food and exotic financial instruments.
The key selling point for investors is diversification. As one portfolio manager put it: “Look, chicken wing demand is essentially recession-proof. People might stop buying homes during an economic downturn, but they’ll sooner cancel their health insurance than stop ordering takeout. That makes these securities surprisingly resilient.”
But not everyone is convinced. Sue Anderson from debt charity StepChange warned: “It’s a worrying development to see mainstream food delivery providers offering BNPL, especially at a time of such financial uncertainty for households”. Research shows those using BNPL are often already in financial difficulty, with a quarter of BNPL users having to borrow from other sources just to keep up with essential costs.
The 2027 Fried Chicken Financial Crisis: A Prediction
Financial experts are already gaming out scenarios for what some are calling “the inevitable fast food financial crisis.” As with any securitization boom, the key risk is mispricing of risk and contagion when defaults start rising.
“What happens when a recession hits and suddenly thousands of people can’t make payments on their three-month pizza plans?” asks one economist. “The SPVs start to fail, the securities lose value, and institutions that are overexposed to chicken-backed securities have to write down billions in losses. Then everyone acts surprised, as if financing consumable goods over multiple months wasn’t obviously problematic.”
Others point to the lack of regulation. “BNPL is not yet regulated, providers may not carry out effective affordability checks or prevent users from taking out multiple BNPL loans from different retailers they are unable to repay,” warns StepChange. This means someone could theoretically go on a tour of digital gluttony, financing a pizza via Deliveroo, a burger via Uber Eats, and a curry via Just Eat, all without any single provider knowing about the others.
In boardrooms across London and New York, risk committees are running stress tests on scenarios like “Widespread Sriracha Shortage” and “TikTok Trend Makes Cooking at Home Cool Again,” trying to calculate the potential downstream effects on their chicken-backed security portfolios.
The Fintech-Fast Food Industrial Complex
The unholy alliance between delivery apps, payment processors, and financial institutions represents what industry insiders are calling “the final frontier of financialization.” Having successfully monetized housing, education, healthcare, and even dating, the financial sector has finally figured out how to extract value from your desperate search for dopamine via deep-fried poultry.
David Sykes, chief commercial officer at Klarna, defended the practice: “We believe you should only pay for what you buy with no interest or fees, and it’s never been more important for consumers to have access to payment options which help them stay in control of their finances”. This statement came shortly after Klarna announced it was selling most of its British BNPL loans to American hedge fund Elliott, presumably because nothing says “helping consumers stay in control of their finances” like selling their debt to a hedge fund known for aggressive investment strategies.
A Klarna spokesperson further justified the model by explaining that “people have been paying for takeaways with credit cards and overdrafts for decades”, seemingly unaware that “other people made poor financial decisions in the past” isn’t typically considered sound financial advice!
The Pizza Default Swap: Coming Soon to a Bloomberg Trading Desk Near You
As the market matures, derivative products are inevitably emerging. Credit default swaps allowing investors to bet against pizza-backed securities are trading with increasing volume.8 Complex structured products with names like “Synthetic Collateralized Chicken Obligations” are being marketed to sophisticated investors looking to increase their exposure to the takeaway sector without the burden of actually owning debt backed by rapidly depreciating edible assets.
One trader described the appeal: “The beauty of these instruments is their short duration. With mortgages, you’re looking at 30-year terms. With car loans, maybe 5 years. But with chicken wings? The entire lifecycle from origination to final payment is just 60 days. The velocity of capital is incredible.”
This rapid turnover has created what some analysts are calling “the perfect perpetual motion machine of bad debt.” As soon as one cohort of tipsy customers finishes paying for their regrettable late-night food choices, another cohort is just beginning their own journey of financial self-sabotage, creating an endless supply of new debt to securitize.
The Future: Micro-Financed Mouthfuls
Industry insiders suggest this is just the beginning. Plans are reportedly underway to offer financing options on individual menu items, allowing customers to pay for the burger today but finance the fries over the next two weeks.
“We’re working on real-time bite-financing,” revealed one fintech executive who spoke on condition of anonymity because the technology is still in development. “Our AI can track exactly how much of the pizza you’ve eaten and adjust your payments accordingly. Eat a quarter of the pizza? Pay a quarter of the bill. The technology uses your front-facing camera to calculate consumption ratios with 97% accuracy.”
When asked about privacy concerns, the executive scoffed. “Privacy? You’re literally allowing strangers to bring food to your home based on an app that already knows your eating habits, address, and credit card details. You gave up privacy around the same time you started taking pictures of your meals for Instagram.”
As we contemplate a future where every french fry comes with its own amortization schedule, one can’t help but marvel at the innovative ways capitalism continues to extract value from increasingly mundane activities. The securitization of food delivery debt represents either the pinnacle of financial innovation or the absolute nadir of our collective decision-making, depending entirely on whether you’re selling these securities or buying that 1 AM pizza.
So what do you think? Is financing your takeaway over three months the height of modern convenience or a sign of impending financial doom? Have you ever used Klarna to buy food you couldn’t afford, or are you more of a “if I can’t pay for my pizza now, I don’t deserve pizza” purist? Perhaps you’re an institutional investor looking to diversify your portfolio with some spicy chicken-backed securities? Share your thoughts in the comments below, preferably before your next financed meal arrives.
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If this article has made you reconsider your late-night ordering habits—or alternatively, given you exciting new ideas for structuring your personal takeaway debt—consider supporting TechOnion with a donation. Unlike your pizza, which depreciates to zero value the moment it enters your digestive system, your contribution will help fund future investigations into the increasingly blurry line between financial technology and terrible life decisions. We accept all major payment methods, including one-time payments, 30-day delayed payments, or three convenient monthly installments that we promise not to securitize and sell to Goldman Sachs.
References
- https://deliveroo.co.uk/more/pay-with-klarna ↩︎
- https://www.thegrocer.co.uk/news/deliveroo-offers-eat-now-pay-later-with-klarna/672416.article ↩︎
- https://www.independent.co.uk/life-style/deliveroo-klarna-takeaways-debt-warning-b2201238.html ↩︎
- https://www.bloomberg.com/news/articles/2024-06-07/debt-markets-are-fueling-buy-now-pay-later-s-resurgence ↩︎
- https://www.pymnts.com/bnpl/2024/klarna-reportedly-selling-uk-bnpl-loans-to-hedge-fund-elliott/ ↩︎
- https://www.guggenheiminvestments.com/cmspages/getfile.aspx?guid=1b930cb1-783b-4b10-a6ca-4deadd881338 ↩︎
- https://www.guggenheiminvestments.com/cmspages/getfile.aspx?guid=1b930cb1-783b-4b10-a6ca-4deadd881338 ↩︎
- https://x.com/allenf32/status/1924559515917119948 ↩︎
