Technology has always been imperative for the functioning and advancement of financial institutions. Banks are always at the forefront of institutions that manipulate technological innovations to increase their efficiency and simplify most tasks.
The world has been testing the various possibilities and applications of Artificial Intelligence since its inception in the 1950s. The banking sector realized that the use of AI for both front-end and back-end activities could greatly benefit them. By integrating Artificial Intelligence with their core-function, strategies, and sales, these financial institutions could provide an improved customer experience and reduce various costs.
Detecting fraud
One of the biggest issues that plague financial institutions each year is fraudulent activities that cost customers and banks millions of dollars. Since most banking activities have turned digital and are carried out online, it is of utmost importance that each digital procedure is carefully monitored to prevent anyone from being swindled.
Human employees would find it nearly impossible to track and verify everything that goes on in the bank’s digital platforms. But a competent AI system can cover all the bases and watch out for any anomalies.
When a bank deploys artificial intelligence on its company website and applications, it can monitor all the activities, understand standard customer behaviour patterns, and quickly detect anything out of the ordinary. Banks using AI in this field have already managed to save their customers several millions of dollars each year that they could have lost to fraudsters.
Customer Service
Banks have been making attempts to improve their customers’ online experience by equipping chatbots with Artificial Intelligence. Unlike traditional customer support carried out by humans, the AI-equipped chatbots can interact with users at any time of the day. Different virtual assistants can be made responsible for specific tasks. While one is concerned with answering general queries regarding the various services offered by the bank, the other can make recommendations based on unique insights regarding each customer.
The use of intelligent chatbots well-versed in multiple languages are especially essential for banks that deal with global customers. Though consumers were initially reluctant to let go of human customer service, many have started to appreciate the simplicity of dealing with intelligent chatbots.
Facial Recognition
Reducing the hassles associated with signing in to their bank account each time can encourage more individuals to make use of digital banking platforms to deal with their money. One of the latest techniques that have attempted to better this scenario is facial recognition technology. When signing in at their bank account using their iPhones, customers can easily take a selfie to verify their identity.
Artificial Intelligence in the app will analyze the customer’s facial features with the data already available on the system to ensure that they are the bank account holder.
Since voice searches have become more prevalent in the past years, and its uses are expected to grow, banks have tried to include it in their online platforms. Enabling customers to carry out tasks using voice commands makes it much easier for many sections of society to engage in online transactions. But, it comes with the danger of people misusing other’s voice recordings to enter their accounts.
Personalization
Artificial Intelligence can be used by banks to understand each customer and not categorize them into different groups. Using these unique insights gathered by the AI, banks can tailor-make offers and products with the maximum chances of being availed by each customer. Collecting data regarding audience behaviour is a great way to create personalized content and dole out the right information to the right people.
Instead of showering each customer with an array of services they are not inclined to use, an AI will help figure out what to offer to each customer.
Bank users desire that online banking be much more straightforward and tailored to their personal needs. So an AI-powered personalization system can bring in more customer engagement and contribute to the growth of the firm.
Cash Optimization
One of the biggest headaches that banks regularly deal with is the management of their ATMs spread around the state or the country. Many banks use CITs to deposit money regularly in the machines, but this process can be cost-intensive and lead to additional expenses. Determining the amount of cash to be deposited in each device also involves guesswork from the employees and attempts made at deciphering customer patterns.
With the help of AI-equipped software, banks have found it tremendously easier to go about refilling their machines when necessary. The AI carries out cash forecasting after analyzing the frequency and amount of customer withdrawals each week, each month, etc. These AIs also help understand how behaviours change during the weekends, during festivals and at each location.
With the help of AI cash forecasting, banks have managed to refill their machines right before they run out of money, preventing dissatisfied customers from leaving in search of other ATMs. This has helped reduce the loss of withdrawal charges for these banks.
Cash optimization in ATMs also involves the prevention of overfilling ATMs in certain regions. The money which would have been sitting in the machine benefitting no one could be used for various other purposes to increase profits.
Banks have also managed to cut unnecessary expenses by entering into contracts with CITs, instead of paying them every time they make a delivery.
Summing up
AI has helped transform customer interactions with financial institutions. By detecting and preventing fraud, banks have managed to save millions of dollars and earn their customers’ trust. Institutions with ATMs have also used Artificial Intelligence to make accurate predictions regarding the cash demands of each machine.
