How conversational and generative AI are disrupting banking
According to an Accenture analysis, banks are more likely to benefit from generative AI (GenAI) than any other sector, with a potential productivity boost of up to 30%. This comes as no surprise when you consider that organizations need piles of good data to benefit from AI – and for banking, data is in abundance.
With physical branches closing almost daily, AI is increasingly being used to improve our digital banking experience. Think of improving the customer experience, more efficient service, personalized offers and more security.
But how are conversational AI (CAI) and GenAI really changing the banking industry? And what can consumers expect from these experiences in the future?
VP of Europe for Kore.ai.
Consumers are already familiar with CAI and GenAI
Advances in CAI and GenAI bring countless potential use cases and applications for the banking industry to stay ahead of the curve and they have the potential to touch every process and role within an organization, allowing it to continually reinvent itself. Simply put, while GenAI produces original content on demand, CAI specializes in holding authentic two-way interactions that mimic human interactions. Together, the two technologies complement each other to deliver an enhanced experience.
Kore.ai’s latest CX Benchmark report highlights that UK consumers are comfortable using AI in their banking interactions and would welcome more AI Automated Assistants to support them. For example, 100% of respondents said they would be interested in an Automated Assistant to help them with bill payments or ATM information, with two-thirds (67%) saying they would like support with transferring money, checking balances, setting budget and spending goals, and checking their credit score.
It comes as no surprise, then, that Gartner’s 2023 Financial Services Research Panel Survey found that 61% of banking executives say their firms are increasing their investment in AI or plan to do so in the next 12 months.
But with CAI and GenAI evolving at a rapid pace, banking institutions must ensure they have the right infrastructure in place, fully understand the potential risks and value that new AI solutions can bring, and take steps to implement AI responsibly.
So where are banks going now? And where are they already seeing success?
The immense potential of GenAI
Given GenAI’s enormous potential to increase revenue and efficiency and manage risk, here are some example use cases for the financial industry:
- Frontline employees are better equipped to have personalized, context-driven conversations with customers
- Context-based product recommendations tailored to financial needs are delivered in real time
- Insights and actionable summaries are provided, accelerating accurate decision making
- Enhanced credit risk assessment and fraud detection
- Outbound promotional and marketing campaigns can be hyper-personalized
- Contact center agents can receive real-time suggestions to guide them through conversations, improving the customer experience.
To seize this opportunity and improve the customer and employee experience, financial institutions need to invest in a CAI platform. This is one of the key use cases of GenAI.
Together, GenAI and CAI complement each other to drive better business outcomes. CAI leverages the power of AI and natural language processing (NLP) to enable machines to have human-like conversations.
CAI is already transforming customer, agent, and employee interactions and experiences through primarily dialog-based conversations. And while GenAI accelerates interactions (from better understanding intent to data analysis and synthesis to content creation), CAI helps keep GenAI within its boundaries – by ensuring that guardrails are in place so that interactions can happen responsibly.
Transforming customer service with automated assistants
Automated banking assistants can automate repetitive queries and access customer data and knowledge bases, providing 24/7 contextual support for rapid issue resolution across any channel and in any language customers choose. Financial institutions can also add personalized service offerings tailored to an individual’s needs, such as assisting with budgeting, answering complex questions, or identifying cross-selling and upselling opportunities.
This provides customers with a contextual banking experience, driving real-time engagement. This could include information about their credit score, including how to improve it, or offering account upgrades if they’ve been a customer for a long time.
A look into the future of finance powered by AI
As the adoption of AI technologies in banking grows, the potential value it can deliver to the global banking sector is estimated at $1 trillion per year, according to McKinsey. AI-first institutions that prioritize and adopt applications for the foundation of their operations are expected to thrive and lead the sector.
AI-driven personalization and omnichannel experiences have become crucial for banks to stay competitive. Customers today expect customized services and seamless interactions across channels, and CAI and GenAI are well positioned to deliver just that. Rapid innovation cycles powered by GenAI enable banks to stay ahead of the curve and effectively respond to changing customer demands.
Ultimately, the future of banking is undoubtedly intertwined with the possibilities of GenAI. For those who adapt, the possibilities for advancement and benefits are endless.
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