Unleashing the power of generative AI
The potential impact of Artificial Intelligence on the financial services sector has been well-recognized for many years. According to a survey by The Economist Intelligence Unit, 77% of bankers believe that the ability to unlock value from AI will be the key differentiating factor between winning and losing banks.
A study conducted by McKinsey in 2021 found that 56% of respondents were already utilizing AI in at least one aspect of their organizations. However, it was in 2023 that the adoption of AI accelerated even further with the introduction of Generative AI. ChatGPT, the most renowned Gen AI model, achieved a staggering milestone of 100 million monthly active users within just two months of its launch, making it the fastest-growing consumer application in history.
In response to this new reality, banks have swiftly embraced AI as a top priority. According to a survey by Accenture, nearly three-quarters of companies are now prioritizing AI over all other digital investments.
AI is reshaping the digital banking path ahead
Generative AI is revolutionizing personalization in the financial industry, empowering banks to extract valuable insights from customer data and customize their services, experiences, and journeys.
The emergence of generative AI could be a game changer, lifting productivity by 3 to 5 percent and enabling a reduction in operating expenditures of between $200 billion and $300 billion.
- McKinsey Global Institute (MGI), 2023
Although there are potential risks of hallucinations and errors associated with the widespread integration of Gen AI into all customer-facing services by 2024, providers are actively working to overcome these challenges and ensure its success.
AI plays a vital role in streamlining processes such as onboarding, verifying identities, and guiding customers through account setup. Additionally, AI automation takes care of routine tasks like balance inquiries and password resets, freeing up human agents to tackle more complex issues.
This not only enhances efficiency and cuts costs but also provides round-the-clock support, improving accessibility and customer assistance. Moreover, the integration of AI into banking applications creates a seamless, multilingual interface for transactions, account information, and alerts.
How generative AI is transforming the banking Industry
Generative AI offers a plethora of opportunities for banks and credit unions to enhance their services and optimize customer experiences. Here are some key features that highlight the transformative capabilities of generative AI in the financial industry.
1. Financial advice
Banks have the incredible ability to train chatbots that can serve as knowledgeable advisors, offering valuable investment information and guidance to users. By receiving these personalized recommendations, individuals can make well-informed decisions that not only enhance their investment strategies but also promote financial literacy and empowerment.
2. Credit score monitoring
AI can assist users in monitoring their credit scores and provide valuable guidance on ways to improve them. This empowers individuals to take proactive measures towards enhancing their overall financial well-being.
3. Account management
AI-powered models can be harnessed to empower users with seamless assistance in handling a wide range of account management tasks, including the setup of automatic payments, effortless updates of personal information, and convenient management of account preferences. This transformative capability significantly streamlines the entire account management process, ensuring a hassle-free experience for valued customers.
4. Customer service
AI-powered chatbots can act as highly efficient customer service representatives, swiftly addressing frequently asked questions and swiftly resolving simple issues. This seamless interaction provides customers with a convenient and stress-free means to obtain immediate assistance and support.
5. Fraud prevention
Harnessing the power of AI, banks can bolster their security measures by constantly monitoring user transactions for any signs of unusual or suspicious activity. This proactive stance not only acts as a deterrent to fraud but also provides a robust safeguard for users' accounts, ensuring their financial well-being and peace of mind.