Are the banks ready for AI? What can they achieve by using AI? What is the process to integrate AI in banking? In today's world no one has the time to go to banks today and one of the reasons for that is the banking hours are the hours you are working at your own office, and it is usually closed on the weekends and holidays taking a leave for some bank related work is not an option one considers. James Duez, co-founder and executive chairman of AI Company Rainbird points out, the banking sector is also under pressure to meet the needs of a millennial audience."The under-35s are presenting new challenges for banks. This digital generation expects seamless, flexible, multi-channel platforms. They want fast responses and effective solutions to their problems, right now." Banks are filled with computers and networks, now everything about bank be it transaction, wealth storage data are all done on the network or are stored on it. Except the cash you have in your hand that is paper, money.
While some banks and the management see it as a threat or competition. Some believe it the necessary revolutionary measure the bank needs to improve the relation between them and the customers. According to research by global management consultancy Accenture, banks that invest in AI and human-machine collaboration tools could boost their revenue by over a third (34 per cent) by 2022. As impressive that might sound, artificial intelligence technologies are aiming to further revolutionize the way banking is done and to improve the relationships between banks and their customers.
1.People and chatbots
As banks are not a 24/7 thing, the use of conversational assistants or chatbots to engage the customers is one the most impactful if not most impactful applications of AI. These chatbots help customers in handing many things like transactions, banking services, general information and other non human involvement related tasks. A good example of this is The Bank of America introduced Erica, an AI assistant to help with customer transactions, and the bot has shown significant positive ROI. Many banks have quickly followed suit, although some saw mixed results.
2.AI in banking aids regulatory compliance
When it comes to economy banking is considered as a highly regulated sector all around the globe. It has a notable cost and a pretty high liability. AI is the smart opposition banks are looking for, AI can help banks in monitoring transactions, keeping a look on how a customer behaves, audit and log information for various compliance and regulatory systems. According to a study Big data-enhanced fraud prevention is already having a significant impact on credit card and loan underwriting processes, and the addition of machine learning and cognitive technologies is helping those systems stay ahead of the game as the nature of fraud continues to evolve.
Banks are no stranger when it comes to frauds and other practices related to the term. In the beginning the reason AI was introduced to banking was that it will help the banks with detecting frauds and help the bank respond to them as quickly as possible. Authorities need to be on their toes to ensure the financial and data security of their clients. AI can spot anomalies and patterns in transactions better than the human eye. AI has also been able to spot a growing volume of false positives for 'suspicious' card use.
4.Reducing the operating cost and risks
Even though banks operate mostly digitally, but there is a lot of paper work that is still requires a lot of human process. The use of AI helps banks impose audit and regulatory control in areas which was not possible previously. By replacing humans with intelligent, automated assistants, banks can focus their human resources on higher-value tasks, such as offering new services to their customers or improving customer satisfaction.