Klarna teamed up with OpenAI to launch its first virtual assistant, and – one month in – the results appear overwhelmingly positive.
Indeed, Klarna stated the assistant had been responsible for two-thirds of customer service chats and was completing the work of 700 employees.
Moreover, the financial service company revealed its query resolution time had dropped from 11 minutes to just two minutes while customer satisfaction scores remained steady.
Altogether, Klarna estimates the innovation will drive a $40 million USD improvement in profits to Klarna in 2024.
In discussing the news, Sebastian Siemiatkowski – Co-Founder and CEO of Klarna – commented:
This AI breakthrough in customer interaction means superior experiences for our customers at better prices, more interesting challenges for our employees, and better returns for our investors.
Available in the company’s app, Klarna believes that the assistant will improve both the shopping and payment experience of its global consumers.
The partnership with OpenAI marks the first step in Klarna’s “vision of a fully AI-powered financial assistant,” which it hopes will enhance the customer experience – saving users time, worry, and money.
In its current iteration, the Klarna AI assistant provides users with the following three key features:
1. 24/7 Support
As the name suggests, Klarna’s assistant will be available at all times and will provide customer service support for an array of prevalent problems, including refunds, returns, payment-related issues, cancellations, disputes, and invoice inaccuracies.
2. Personal Financial Support
Given Klarna’s buy-now-pay-later model, keeping track of outstanding and upcoming payments is understandably a key issue for its users.
The AI assistant will supply customers with real-time updates to help them stay abreast of their payment schedules, as well as provide guidance and explanations around spending limits and “purchase power.”
3. Multilingual Chat Support
Currently available in 23 markets, in order to adequately support its global customer base, Klarna’s assistant has the capacity to handle queries in 35 languages.
During the announcement, Klarna praised the language support feature as one of the reasons for the company’s “massive improvement in communication with local immigrant and expat communities across all our markets.”
Going All In on AI a Gamble
The success of the virtual agent follows an announcement made by Siemiatkowski back in December of 2023 that Klarna would be freezing hiring in order to pursue AI alternatives, with the Co-Founder and CEO stating that the company was “not currently hiring at all, apart from engineers.”
This promise appears to be playing out rather quickly, with the company’s Annual Report revealing that Klarna had dropped more than 1,200 employees – from 5,441 to 4,201 – between 2022 and 2023.
While the fintech was also clear to point out that customers could “still choose to interact with live agents if they’d prefer”, it is apparent that Klarna is all in on AI.
Speaking with Fortune, Siemiatkowski admitted that a conversation with OpenAI CEO Sam Altman had convinced him to hitch the company’s wagon to AI – stating that he wanted Klarna to operate as the ChatGPT creator’s “favorite guinea pig.”
Yet, while this appears to be a case of so far, so good, a recent Gartner report warned against the dangers of pursuing a digital-only customer service solution. It predicted that the EU could make “the right to talk to a human” a part of its consumer protection laws within the next three years.
Rather than opting for AI assistants instead of human agents, Gartner recommends a tandem approach that sees AI in more of a supportive capacity, arguing that “it is too risky, expensive, and difficult to replace customer service reps with a generative-AI-powered chatbot.”
As such, it’ll be fascinating to see how Klarna’s customers react to the new virtual assistant moving forward and whether the company will regret placing all of its chips on AI.
