<type name="Klarna\Ordermanagement\Controller\Api\Notification">
    <plugin sortOrder="1"
            name="klarnaKpNotification"
            type="Klarna\Kp\Plugin\Controller\Api\NotificationPlugin"></plugin>
</type>

This is a type configuration.

This configuration is for the frontend area. This is the area that corresponds with the cart sub-application.

This configuration also tells the object manager to use the Klarna\Kp\Plugin\Controller\Api\NotificationPlugin plugin class with Klarna\Ordermanagement\Controller\Api\Notification objects.