AI, Please Hold for a Human(08.08.2025)
In a striking reversal, Klarna has announced its return to human-powered customer support after a high-profile push toward AI-driven service fell short of expectations. What began as an ambitious automation strategy is now being tempered by a renewed emphasis on empathy, quality, and customer trust.
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Klarna initially embraced a bold AI initiative, going so far as to pause hiring and lay off hundreds of service staff, convinced that a generative AI chatbot could fully handle customer inquiries. The bot, powered by OpenAI technology, reportedly resolved 2.3 million requests in its first month - about two-thirds of Klarna’s customer service traffic - with an average response time of fewer than two minutes and no apparent dip in satisfaction. The company projected a $40 million annual boost in profits from this efficiency gain
However, according to an internal admission by CEO Sebastian Siemiatkowski, the automation-led model ultimately failed to uphold Klarna’s standards. A reliance solely on AI compromised service quality, leaving customers frustrated by a lack of human nuance and empathy. In response, Klarna has shifted to a hybrid approach, prioritizing a reliable path to human support alongside automated systems. The company is now recruiting remote customer service agents - with an “Uber‑style” model emphasizing flexibility, targeting students, rural workers, and existing users.
Industry analysts see this as a critical recalibration of strategy. Julie Geller from Info‑Tech Research Group highlights that automation must complement, not replace, human agents, especially in emotionally sensitive or complex cases. Klarna’s pivot recognizes the uneven limits of AI, which can speed up routine requests but struggles with nuanced problem-solving and emotional engagement.
Klarna spokeswoman Clare Nordstrom sums up the new philosophy: speed comes from AI, empathy from people. The company has emphasized that the bot will remain central - continuing to handle around two-thirds of inquiries - but serious cases will always have human escalation. Response times have improved by 82 percent and repeat contacts dropped by 25 percent, yet the restored availability of live agents is seen as a critical set-point for customer trust.
Conclusion
Klarna’s sudden pivot holds powerful lessons for financial services and the broader tech landscape. The episode underscores that while generative AI can bring notable operational efficiencies and cut costs, it cannot fully replicate the empathetic judgement and adaptability of human agents. As AI continues to advance, businesses face the challenge of striking the right balance - leveraging automation for routine efficiency without sacrificing human oversight where it’s most needed. For industry leaders and regulators alike, Klarna´s experience highlights the need for strategies that embed AI as a tool to amplify, rather than replace, the human touch.
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