Artificial intelligence is everywhere. From business innovations and media headlines to TV and films. In the financial services industry will still be in its early stages however the organizations are slowly making up ground. Banks are navigating how they may build and implement AI that capitalizes around the skill sets available and addresses the highest-priority challenges and opportunities for the industry. The added bonus – it's expected to save companies big bucks.
Where AI is Creeping in
Some large banking institutions, including commercial banks, insurance and wealth management companies, have begun using AI or partnered with AI startups. Erica, Bank of America's AI powered virtual assistant, uses voice commands and texting to assist customers with basic tasks like searching for account information or transferring money.
It's not just about customer facing technology. AI has been tested for middle and back-office tasks too. By using machine understanding how to analyze big data sets, AI is helping companies:
- Monitor for online fraudulent activities in real-time
- Make faster and much more informed lending decisions on customer loans
- Reduce the time is takes to complete compliance and regulatory tasks
Key Considerations for Implementing AI
Just as with any big operational change, AI requires a careful implementation plan to be truly effective. As banks and lending institutions adopt this powerful technology, you will find 4 steps to consider.
- Build a quick, secure digital backbone
To function correctly and deliver value, AI needs access to large amounts of quality data that it may collect, analyze, and make decisions upon. The information needs a highly secure, low latency connection to quickly travel from point of capture to point of analysis after which back again.To achieve this a cloud infrastructure is usually recommended. Having a strong digital backbone and appropriate infrastructure in place will help financial institutions future-proof their AI technology investments.
- Re-skill the workforce for AI
In the near future, employees and AI will work together to solve problems. Although some current jobs will be taken over by AI, more jobs is going to be created for AI and employee collaboration. Workforces should adjust to this by re-skilling talent and reorganizing teams. Based on Accenture, banking executives say only one in 4 employees are prepared to work with intelligent technologies. Companies can begin by planning how they uses AI, researching the skills required to work with the technology and building a worker training plan.
- Follow privacy and security requirements
Respecting the privacy of customer data while keeping high security standards is crucial. AI uses a large amount of customer data to 'learn' and perform tasks. This could make tracing its progress and just how it uses customer data complex. Plus, laws such as the General Data Protection Regulation (GDPR) and Payment Services Directive (PSD2) require companies to be more transparent with customer data. These emerging factors combined with the highly regulated finance industry means special care is needed when adopting AI. It is also vital to regularly update governance policies in lowering and control any potential risks.
- Stay associated with customers
From predicting future issues to personalizing recommendations, AI helps to improve customer services. Additionally, AI is being used to resolve simple issues efficiently. This frees up customer service representatives to help with more complicated questions or tasks. It is important to balance using AI with human employees. Although AI can 'learn' like humans, still it lacks emotional intelligence and empathy. To ensure businesses are staying in touch with customers there must be regular touchpoints and customer service surveys to ensure the AI is providing a benefit, not a hindrance.
The Staying Power of AI
AI will have an increasingly important role within the banking industry because the rewards outweigh the risks. It presents the potential to help financial services organizations save your time and money by becoming more efficient. This presents the opportunity to provide more personalized, omnichannel services for their customers and members.
To succeed, financial services organizations need a fast and secure digital backbone to manage the data and computing needs of AI. It is important to complement this with re-skilling the workforce to completely understand its benefits. Finally, no enterprise should lose sight of ensuring the best security measures are in place, privacy and compliance standards are adhered to, and the human factor is never entirely lost. By remembering these 4 elements and developing a thorough implementation plan, the financial services industry might help humans and AI interact harmoniously.