Klarna, the Swedish fintech, is going through a big transformation: it means fire half of its employees and replace them withartificial intelligence. This year, the company, currently in financial difficulty but close to landing on Wall Street, has already replaced around a thousand workers with AI. The CEO Sebastian Siemiatkowski has no doubts about the benefits: AI has reduced the average problem resolution time from 11 to just 2 minutes.
Who is Klarna?
Founded in 2005 with the “Buy Now, Pay Later” system, which allows online purchases to be paid in installments without interest, Klarna saw a surge during the lockdown, reaching a valuation of $46,5 billion in 2021. But, as often happens with comets, reality hit hard: An overly ambitious expansion in the United States led to huge losses, knocking the valuation down to just $6,7 billion at the end of 2022. Since then, Siemiatkowski has put in place a plan that, in addition to diversify the offer and promoting interest rates at 3,58%, is based on a radical strategy: reduce staff and have AI work instead of human employees. Siemiatkowski's recipe led to a significant reduction in losses one review for the 'Ipo of fintech estimated between 15 and 20 billion of dollars.
Klarna: AI is here to stay
The debate on replacing workers with AI is now on the table, and Siemiatkowski seems to have no doubts: “Not only can we do more with less, but we can do much more with less.” During the presentation of the accounts on August 26, he announced his intention to reduce staff from 5.000 to 2.000 employees. This comes after an initial round of layoffs which saw the number of workers drop from 5.441 to 3.800. Furthermore, there is talk of possible maneuvers to oust Mikael Walther, right-hand man of co-founder Victor Jacobsson, from the board of directors, which will meet today, August 28.
Siemiatkowski has always had a soft spot for AI, seeing it as his magic wand for cutting costs. In May, via a pre-recorded video, he announced the dismissal of 700 people, 10% of the workforce. Today, the CEO uses these cuts as a selling point, explaining that “Our AI assistant does the work of 700 employees, reducing problem resolution time from 11 to 2 minutes, while keeping customer satisfaction standards intact.” And the workers? With AI replacing more and more jobs, according to the CEO, the responsibility di handle le fallout employment and ensuring a fair transition falls on the governments.
The AI effect on Klarna accounts
I layoffs they had a impact positive on the accounts: the average annual turnover per employee went from 400 thousand to 700 thousand dollars in one year, with a growth of 93% in the United States. Siemiatkowski, as mentioned, intends to continue reducing staff, aiming for around 2.000 employees in the next few years. Customer services and marketing roles will be replaced by AI, while technicians and specialists will remain to be attracted. Klarna's mantra is clear: “Lower total labor costs, higher costs per individual.” In other words, save on the costs of staff to afford pay more i top managers.
And who knows, maybe the next time you see a chatbot solving your payment problems, you'll reflect on how little humanity is left in the world of fintech. If AI can make us save and earn more, why stop? Who needs humans when you can have an army of algorithms?
