Is It Bonkers To Think Bots Can Be Bankers? The Future Of Artificial Intelligence In Banking

Posted on: 15 January 2018

Advancements in artificial intelligence (AI) -- including natural language processing and machine learning -- are game changers when it comes to how banks are starting to use and benefit from chatbots (bots, for short) that can handle customer interactions.

Here's why your banking institution or credit union can benefit from conversational AI for finance:

1. Artificial intelligence chatbots help optimize banking sites for search engine optimization. They're able to respond to natural language now, which means that they can capture the needs of the mobile consumer in the micro-moment that matters the most.

This means early adopters of the technology are likely to get ahead of their competitors who are still relying on highly-limited "virtual assistants" who are extremely limited in their uses. The more services a chatbot can provide, the more useful consumers are going to find them and gravitate toward those institutions that provide them.

2. There's significant pressure from consumer to provide them with affordable financial advice and reduce the level of exposure consumers feel when interacting with a live human.

In other words, AI bots that have the capacity to learn what consumers want and give appropriate financial advice (for example, by answering questions like, "Where could I cut my spending?" or "How much am I spending on eating out each month?" quickly and easily) could actually make consumers more comfortable than dealing with human beings.

Consumers don't really want other humans peeking too deeply into their finances and aren't sure they trust the calculations. Decades of learning to rely on tech for true and accurate information -- plus its impersonal nature -- makes consumers less hesitant to use that tech for financial services. 

In addition, younger consumers, like Millennials, feel comfortable letting AI direct them financially. Half of the people in the U.S. already feel that AI can make better budgets than they can.

3. Chatbots can save banks significantly in terms of manpower. Today's consumer is linked in 24/7, 365 days a year. They want what they want, whenever they want it. Millennials, in particular, can be frustrated by delays in service. 

This is particularly important when it comes to fraud protection. AI can be trained to evaluate signs of risk and improve fraud detection -- with little frustration on the consumer's end.

An AI that's inadvertently tagged a consumer's legitimate transaction as potential fraud and locked the account can also be trained to evaluate whether or not the person contacting them to resolve the issue is the legitimate card or account holder using everything from voice-recognition technology to simpler data checking. Then the bot can open the account back up. That gives consumers additional security without additional hassles.

Ultimately, it's far from bonkers to think of artificial intelligence as bankers -- in fact, it's probably the most prudent step any financial institution or advisor can add to its online services.

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