Klarna’s AI Revolution: From Automation to a Human-AI Hybrid Model
Having replaced 700 human workers with AI in 2022 to streamline operations, the company is now in the process of reintroducing human agents to boost service quality.;
By : DC Correspondent
Update: 2025-05-26 10:21 GMT
Stockholm — In a major pivot, Swedish fintech giant Klarna is reevaluating its approach to customer service after its aggressive shift to artificial intelligence led to unintended consequences. Having replaced 700 human workers with AI in 2022 to streamline operations, the company is now in the process of reintroducing human agents to boost service quality.
Klarna, best known for its “buy now, pay later” platform, had embraced an AI chatbot developed in collaboration with OpenAI that by 2024 was handling two-thirds of all customer service chats. The shift promised faster responses, reducing average resolution times from 11 minutes to fewer than two minutes and led to a 25% drop in repeat inquiries. Yet the gains in efficiency came at a cost.
Customers began voicing frustrations over the impersonal nature of AI interactions, particularly for more complex or emotionally sensitive queries. Klarna’s CEO and co- founder, Sebastian Siemiatkowski, has now publicly acknowledged the misstep, noting that over-reliance on AI diminished service quality.
“As cost unfortunately seems to have been a too predominant evaluation factor when organizing this, what you end up having is lower quality,” Siemiatkowski said during a recent address at Klarna’s Stockholm headquarters. “Really investing in the quality of the human support is the way of the future for us.”
The decision comes as Klarna grapples with a declining valuation. Peaking at $45.6 billion in 2021, the company is now worth around $6.7 billion. In light of these challenges, Klarna is shifting to a hybrid customer service model that combines the efficiency of AI with the empathy and nuance that only human agents can provide.
To this end, Klarna has launched a new hiring pilot program that mirrors an “Uber-type setup,” offering flexible, remote customer service roles with competitive pay. The initiative aims to replace “the few thousand human agents” currently outsourced to external firms. So far, two employees have joined through this pilot model, with the firm eyeing students, rural residents, and passionate Klarna users as potential recruits.
“I just think it’s so critical that you are clear to your customer that there will always be a human if you want,” Siemiatkowski emphasized.
While reaffirming Klarna’s commitment to enhancing its human support system, Siemiatkowski also clarified that the company won’t abandon AI entirely. The technology will continue to be deployed in other areas, particularly to boost internal software efficiency.
As Klarna works to rebuild trust and service satisfaction, its hybrid approach may well become a model for other companies navigating the complex balance between automation and human connection.