Why is AI essential to help banks with digital newcomers? Since the financial crisis in 2008, banks have been cutting costs. The main cost cut was to new technology. They have only recently started investing in innovation and new tech but after a decade-long hiatus, they are not the only ones in the banking world anymore. These new and digital-first competitors like the bigtechs of Amazon, Google and Apple — and fintech companies, such as Square and Ally, along with South African companies like Payfast and the new Tymebank, have risen to disrupt traditional retail banking business models.
With the climb of fintech and more competition, innovation has shifted so fast that it is not controlled within the banking industry itself anymore. While the bigtechs and fintechs have not replaced traditional banking they have an edge with superior customer service through the delivery of a more personalized experience in real time.
Banks need to up their game when it comes to customer experience. At the end of the day improving your customer experience is the best way to move forward. The competition is no longer between rival banks but the top apps on a customer’s device. A great way to navigate these new challenges that face conventional banks is to start thinking unconventionally. Get the newest software, improve customer experience by getting to know your customers and personalizing their banking experiences, and this is where AI is essential. It helps gather the vital information about a customer’s past banking needs and expectations.
Additionally, according to the World Economic Forum/Deloitte, 76 percent of financial service industry chief experience officers agree that artificial intelligence is a top priority because it is critical for differentiation. AI is a way to get more information about a customer’s past and present banking data no matter what channels it goes through meaning physical locations (e.g., ATM’s and branches), web channels, digital wallets, point of sale activity and mobile devices. Then it contextualizes that information creating a customer profile that the bank can use to help improve their customer relationship. Once the customer’s banking activity has been contextualized, the bank can enhance the customer experience, whether that’s through supporting the front line in engaging with customers, or digital marketers in analyzing the impact of campaigns.
AI can enhance personal customer needs. It allows banks to have a 360-degree insight into customers’ activities and that helps banks deliver better customer experiences in real time. Helping them meet the expectations of the customer so they can up-sell and cross-sell in a personalized way and therefore even predict the future needs of the customer.
Banks that don’t use AI stand a chance to not only lose existing customers but also future ones. Banks need AI because they have the data but gathering it from multiple internal systems and knowing how to analyze and act on that data, enabling the effective delivery of personalized, contextual messages and curated experiences within a matter of milliseconds is what will keep them in the running with their competitors.
Here is a look at some of the aspects to look for when deciding on an AI-powered customer insight solution.
• A Banks’s AI solution should be designed to monitor and facilitate real-time interaction across all existing channels and with its ecosystem in an agile, secure and scalable fashion. It should also have all the customers’ information available to the bank’s call center. Customer history can be vital to have on hand as a lot of customers don’t want to recount their entire banking history every time they come to the bank.
• In addition to the real time customer services insights, the banks need to look into an AI solution that can also run in terms of the back-end systems. A bank should be able to analyze underlying business processes as well as more effective customer care.
• Furthermore, the bank’s AI system should be able to solve more than just one problem the bank is facing such as looking for and identifying market fraud and maintaining compliance.
AI is the best way forward for banks wanting to transition from the old physical world to a new and innovative digital one where they can better challenge themselves to give better support and customer experience and stay competitive with digital-first players.