Bad news for external law firms?
The Swedish fintech company Klarna is encouraging its in-house lawyers to use ChatGPT to save time on drafting contracts.
The company, which provides payment processing services for online businesses, is using an advanced version of the AI tool, ChatGPT Enterprise, to write first drafts of common types of contracts.
Klarna says the tool now “massively” reduces the time it takes its lawyers to draw up contracts, with Selma Bogren, the company’s senior managing legal counsel commenting:
“The big law firms have had a really great business just from providing templates for common types of contract. But ChatGPT is even better than a template because you can create something quite bespoke.”
Bogren went on to add that “instead of spending an hour starting a contract from scratch or working from a template,” she “can tweak a ChatGPT draft in about ten minutes.”
“You still need to adapt it to make it work for your particular case but instead of an hour you can draft a contract in ten minutes,” the top lawyer said.
Klarna says nine out of ten employees (87%) now use generative AI to assist with their daily work, with usage in the legal department sitting at 86%.
But the rise in adoption of AI tools is not without its problems. Last summer, two lawyers in the US were fined by a judge for using ChatGPT to undertake legal research, leading to non-existent cases being submitted to the court.
Klarna’s strong support for ChatGPT comes after a study found that more than half of lawyers (51%) believe AI should help with legal work. Twenty-four percent said it should not while a quarter were unsure.
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