Klarna U-turns on AI: Rehires humans for customer support after quality complaints

Stockholm-based Klarna, an AI-powered global payments network and shopping assistant, is shifting its customer service strategy after touting AI’s potential to replace human work.

As a part of the strategy, the Swedish fintech unicorn is reintroducing human agents alongside its AI-powered chatbot, reports Bloomberg.

This move aims to enhance service quality and address the limitations of relying solely on artificial intelligence.

CEO Sebastian Siemiatkowski told Bloomberg on Thursday that Klarna is hiring human workers again to ensure that customers always have a human presence to talk to if needed.

Klarna’s AI assistant, developed in collaboration with OpenAI, has been handling a significant portion of customer interactions.

While the AI system has improved efficiency, the company recognises the importance of human empathy and nuanced understanding in customer service.

“From a brand perspective, a company perspective, 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 told the outlet.

Siemiatkowski shared with Bloomberg that Klarna’s focus on AI over the past few years was ineffective. He noted that although AI chatbots are cheaper than human workers, they provide lower-quality service.

Hiring now

Consequently, the company is recruiting a new batch of customer service employees, and the company will now focus on providing “quality” human support for customers.

In its recruitment drive, the company is targeting students, rural populations, and dedicated Klarna users who are passionate about the company.

In December, Klarna stopped hiring to focus on AI investments.

During this time, the number of employees dropped by 22 per cent to 3,500, mainly due to employees leaving.

CEO Sebastian Siemiatkowski asked the remaining employees to use AI to help cover the work left behind.

By February 2024, Klarna reported that its AI could replace 700 customer service agents and had taken on 75 per cent of customer chats, handling about 2.3 million conversations in just a month.

The AI bot answered questions about refunds, returns, and payments in more than 35 languages.

“We also know there are tons of Klarna users that are very passionate about our company and would enjoy working for us,” he told Bloomberg.