Of all the startups that have come and gone, the personal finance company Klarna might be one of the best bellwethers for the finance industry overall.
Specializing in “buy now pay later” microloans — tiny cash advances for purchases that don’t need to go through a bank — Klarna hit app stores at a time when US consumer debt was climbing toward a record high. Now a giant of the personal finance landscape, the billion-dollar company recently reported a jaw dropping 17 percent default rate on its loans, a number which finance experts warn is a bad omen for consumer debt more broadly.
And beyond revolutionizing the consumer debt trap, Klarna is now also offering a cautionary tale in AI automation.
The Swedish company was an early adopter of “AI agents,” a broad term for machine learning software that’s supposedly capable of handling complex computer tasks on its own. There’s just one wrinkle: even the best AI agents remain horribly inefficient, and Klarna has all but bet the farm on their success.
That’s not an exaggeration — after rolling out AI to replace his customer service department in 2024, Klarna CEO and founder Sebastian Siemiatkowski bragged that he hadn’t hired a human in a year, because AI was doing the work of “700 full-time agents.”
Perhaps unsurprisingly, that quickly backfired. In May of 2025, Klarna started scrambling to hire back the full-time workers and contractors it had confidently axed. But as it turns out, hiring a whole department’s worth of staff is a lot harder than firing them. In order to refill its ranks, the company has started forcing software engineers and marketers over from their highly specialized roles into call centers, according to Business Insider.
After falling flat on his face with the AI gamble, Siemiatkowski is once again trying to set his company apart — this time by becoming the “best at offering a human to speak to.”
It’s a particularly telling sign for AI agents and the prospect of AI in business more broadly. A recent survey found that nearly 95 percent of corporate AI rollouts are failing to deliver expected financial returns. Meanwhile, a study of American executives and CEOs found that less than half felt confident in their company’s ability to successfully navigate an AI rollout.
It remains unclear whether Klarna can persuade its engineering and marketing teams to make a career pivot to customer wrangling. Either way, investors are likely to be watching the company’s operationalities ahead of its long-anticipated stock market debut, which is targeting a hefty $14 billion valuation.
More on AI: CEO Brags That He Gets “Extremely Excited” Firing People and Replacing Them With AI