Artificial intelligence (AI)
AI is the future of banking as it leverages advanced data analytics to deal with fraudulent transactions and improve compliance. Right from personalized banking services to detecting frauds and supporting the risk and compliance initiatives, AI algorithms help banks accomplish desired outcomes in a few seconds. It removes the lengthy process, in addition to managing huge volumes of data to derive valuable insights. Banks and financial institutions are leveraging a combination of adaptive, cognitive and Generative AI based approaches for serving customers with smarter decision-making and enhanced engagement.
Cognitive AI is designed to simulate natural human speech, which makes it especially well-suited to power customer service chatbots. These automated chatbots can expertly handle routine customer inquiries such as account balances, recent transactions, and other well-defined interaction in a much faster and consistent manner than their human counterparts. Cognitive AI can also automate the processing of customer transactions and reconciliation.
Adaptive AI is geared toward analysis and decision-making. As the name suggests, over time, it can learn from past human decisions. Banks and financial institutions are using this technology to assist in image/voice recognition to authenticate a customer when they deposit a check via mobile app.
Lately, Generative AI has grown in prominence with a potential to disrupt all industries including Financial Services. In the banking industry, Generative AI has the potential to further improve on efficiencies already delivered by artificial intelligence, ensure fraud detection, enhance customer experience, enhance decision making and automate regulatory reporting.
Analysis
This article mentions several new technologies that will be important in the future, however I was most intrigued by the section on artificial intelligence. Specifically, cognitive AI is being developed to simulate natural human speech, which means it’ll likely move towards customer service and replace the people who work in that department. The chatbots can do a lot of the menial tasks (like giving account balances and processing transactions). This’ll be important to keep in mind when considering innovating on the customer experience at both physical and virtual banks. The article also mentions Adaptive and Generative AI, technologies that can analyze, make decisions, and even come up with ideas on all sorts of topics. They have a lot of potential, but it’s important to remember that for every new chatbot, there are a handful of humans who have just lost their jobs.
Source
Khizamboor, R. (2023, July 26). 5 technologies that are driving the future of banking. Banking Exchange. https://m.bankingexchange.com/news-feed/item/9724-5-technologies-that-are-driving-the-future-of-banking
