A year ago, Klarna CEO Sebastian Siemiatkowski boasted in a letter to shareholders that the BNPL giant's AI assistant was performing the work of 700 employees.

At the time, the company revealed that it had trimmed its workforce through natural attrition from 5000 to 3800 over the last year and Siemiatkowski said there was an ambition to get this down to 2000, thanks largely to AI.

However, in an interview with Bloomberg, Siemiatkowski concedes that the strategy has gone too far.

“As cost unfortunately seems to have been a too predominant evaluation factor when organising this, what you end up having is lower quality,” he says. “Really investing in the quality of the human support is the way of the future for us.”

Klarna is now testing a group of staffers “in an Uber-type of setup” that allows them to work remotely as customer service reps.

“From a brand perspective, a company perspective, I just think it’s so critical that you are clear to your customer that there will be always a human if you want,” says Siemiatkowski.