The Banking sector is using AI to improve customer relationship by gathering information to better understand the intentions and emotions of each customer. There are many AI applications available for use and are increasing daily. Fundamentally AI consists of three technologies: Cognitive Computing, Machine Learning and Natural Language Processing.
AI is mainly used to provide the right information at the right time. And, that is something human beings can not achieve with the same level of accuracy as AI. With all that AI promises to the banking sector, the future is looking bright for AI in banking.
Thus, AI has found wide application in the following areas:
Chatbots or smart virtual agents:
Chatbots are useful for answering queries, enabling payments to friends and making recommendations which makes chatbot the most popular application of AI in banking. For example- Ally Assist which is one of the first chatbots in the financial services industry helps customers in making bill payments, transfer and deposit money and track savings.
COIN is another example of a bot that analyses complex legal contracts which saves hundred of hours of manual effort. There are a few banks that are using bots for answering calls and resolving queries in first contact.
They are similar to Virtual Agents in many ways and are primarily used to collect information and make recommendations to users making them a natural fit for wealth management businesses. They can be used to advise clients.
Chatbots have been seen collaborating with human agents similarly expert systems work alongside relationship managers to deliver hybrid investment management services that are superior to the people only option.
Robotic process automation:
Robotic process automation (RPA) is expected to grow faster through 2018 due to the success of pilot projects. It is extensively being used in banks for onboarding customers, repeatable tasks, accelerating workflows, entering and validating data and performing reconciliations. For example, at ICICI Bank Ltd, software bots perform more than a million transactions each day that span across 200 business processes and will take over 500 processes soon.
Robots are contributing heavily to financial institutions by performing a number of customer service functions to relieve the front office of their mundane responsibilities. They even provide sales assistance by recommending products to customers.
AI-based engines and algorithms:
AI based engines and algorithms can spot suspicious activity as they are capable of analysing transaction patterns in real time and use behavioral indicators to do so. They continuously learn from past experiences to reduce errors. Additionally, they also offer suggestions to eliminate or reduce risk.
Therefore, many banks and financial institutions are moving to a level of automation where most of the financial advisors will be bots. The personalized experience offered by bots is an indicator of a sweeping wave of AI in banking.
Although today, Artificial Intelligence technology and apps are at different stages of maturity with a number of possibilities that still have not been explored, but the banking sector can not wait to embark on their AI journey.