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Klarna, a leading "buy now, pay later" fintech provider, has halted human hiring and relies on artificial intelligence (AI) to perform tasks once handled by hundreds of employees. The company stopped hiring over a year ago, choosing instead to deploy AI across its operations, CEO Sebastian Siemiatkowski told Bloomberg.
The company, which has seen a 22 per cent reduction in its workforce due to attrition, now employs around 3,500 people, down from 4,500 last year. The key reason for this shift is Klarna's growing investment in AI, which Mr Siemiatkowski claims has proven capable of handling much of the work previously done by human employees. One of the most significant AI integrations includes an AI assistant powered by OpenAI, which has taken over the responsibilities of 700 customer service agents.
Despite the decrease in headcount, Mr Siemiatkowski assured existing employees the company would share the productivity gains from AI. “We're going to give some of the improvements that the efficiency that AI provides by increasing the pace at which the salaries of our employees increases,” he told Bloomberg.
Klarna's shift toward automation is also linked to its plans for future growth. The company has confidentially submitted a draft registration statement for an initial public offering (IPO) and is looking to expand its US footprint. “Klarna is a bank in Europe, we want to become a bank in the US,” he said and is ready to take up President Donald Trump's offer of fast-tracking banking licenses in exchange for a $1 billion investment.
Mr Siemiatkowski said that AI has become integral to the company's operations, replacing traditional roles and driving productivity. This, however, has raised questions about the future of human jobs, with experts like McKinsey & Company warning that millions of workers could face job displacement due to AI advancements by 2030.
While Klarna is not actively expanding its workforce, it continues to hire for essential roles, particularly in engineering.
The trend of AI replacing jobs is not unique to Klarna. IBM, another major tech company, has also signalled the potential for AI to replace up to 30 per cent of HR roles within the next five years, as CEO Arvind Krishna discussed in a recent Bloomberg interview. Earlier, Mr Krishna also implemented a new rule for managers saying they must either relocate near an office or leave the company.