Artificial intelligence enables a machine to mimic human cognition. In simpler words, AI enables a system to correctly interpret external data, generate useful insights from it, and use those insights to achieve specific goals. A banking institution generates a large volume of data that is beyond the limits of humans to efficiently analyze and derive actionable insights from it. This inefficiency opens the doors of the banking sector to the adoption of AI and data analytics. According to global business information provider IHS Markit, the business value of artificial intelligence in the banking industry is projected to reach $300 billion by 2030. The adoption of artificial intelligence in the banking industry can influence banking from A-Z, right from delivering a better customer experience to putting a better fight against financial fraud. Let’s see how banks can leverage AI to accelerate their business growth.
Enhancing Customer Experience with AI
When 2 sellers sell the same product, the one who provides the best customer experience wins the market. Like any other business, providing the best customer service is of high priority for the banking industry. Based on a customer’s financial transaction patterns and past interactions, an AI model can predict the customer’s needs and enable banks to customize the products and services by adding personalized features. This leads to constructive customer engagement and builds strong customer relationships. Listing down a few implementable use cases of artificial intelligence in the banking industry that can boost the customer experience;
⊕ Auto-identifying walk-in customers and greeting them with personalized messages
⊕ Suggesting customized and optimized EMI plans based on past transaction history
⊕ Recommending beneficial financial services based on customer demographics
⊕ Auto face recognition in ATMs for card-free access to offered services
⊕ Assigning the best relationship manager to a customer based on analytical scores
⊕ 24*7 active AI-powered conversational agent to answer any customer queries, etc
Banking Process Automation
Rule-based processes can be automated with the help of AI. Repetitive and mundane tasks such as verifying the authenticity of a signature in a cheque, extracting key information from legal documents, etc can be automated using AI. This automation enables employees to engage in more productive work. For example, JPMorgan Chase started using an AI system to extract information from documents and the tasks that collectively took roughly 360,000 labor hours per year were completed in a few seconds by the AI system. Banking Process Automation secures the return of investment, reduces operations costs, and ensures accurate and quick processing of services. A few implementable use cases of artificial intelligence in the banking industry involving process automation are
⊕ Cheque signature verification
⊕ Document analysis and key information extraction
⊕ Credit card validation and approval
⊕ KYC verification
⊕ Report inference analysis
Chatbots and Conversational AI
Increasing automation poses a problem – reduced loyalty due to less personal contact. However, AI can solve this problem in the form of an intelligent chatbot. Thanks to advancements in Machine Learning and Natural Language Processing and Natural Language Understanding technologies, it’s possible to create conversational tools that can hold conversations with customers in natural language, decipher questions, and provide responses with the right information in a more efficient manner. It helps to avoid the expenditure on human resources since banks can considerably reduce the number of customer care executives. Customer satisfaction will also be enhanced as they can avail of the service in the comfort of their homes without having to visit the bank. Chatbots can be used to announce new offers to the customer such as loans or send alerts to customers if they have any payments due. These conversational tools or virtual assistants can help customers access information such as account activity, routing numbers, bills, transfer money between accounts, schedule an in-person meeting at a branch, locate the nearest branch, etc. It can even educate a user about money management. Bank of America launched an AI-driven virtual assistant in 2018 to serve 25 million mobile banking customers. The capabilities of this AI-driven virtual assistant keep constantly evolving.
⊕ 24*7 active AI-powered agent who can answer any customer queries
⊕ Assisting and educating customers to do financial transactions
⊕ Kiosk-based AI conversational tool can help walk-in customers with their needs
