AI in Banking: Examining the Uses and Benefits

The advent of technology has made life simpler for all of us. It has so deeply penetrated everyday on goings around us, that living without a gadget seems impossible today. Although technology has impacted all industries equally, the finance sector has been significantly disrupted. So much so, that an entirely new industry driven by artificial intelligence in banking has emerged – FinTech.

FinTech is not just AI driven, but also carries transformative power for the entire Banking and Finance industry. Below are some tangible benefits that artificial intelligence brings to the table:

• Better customer service

In 2014, a survey done by Millennial Disruption Index found that millennials hate banks. The traditional banking methodology failed to meet the expectation of modern day’s fast-paced life and need for simplicity. FinTech, with its AI solutions, is trying to bridge this gap.

Transformation through FinTech has opened the door for many opportunities. Personal assistants and chatbots save time and provide answers to frequently asked questions. AI-powered assistants also help with financial plans. They save time that was earlier spent standing in queues.

• Lower workload

Streamlining back-office operations is another revolution brought on by artificial intelligence in banking. Robotic Process Automation (RPA) is automating mundane rule-based processes that offer consistent efficiency and error-free operation.

Without the need for new positions, banks and financial companies can optimise salaries of their employees and maintenance expenses. The existing personnel, as a result, get a chance to grow and develop their existing skill set.

• Advanced information processing

The Finance & Banking Industry generates humongous amounts of data periodically. This data can be processed with advanced AI software to derive valuable insights for making accurate forecasts and projections. These insights allow companies to develop a wide-range of personalized services and targeted solutions for their customers.

• Fraud detection

Artificial intelligence in banking is also helping to curb fraud. High velocity, volume, and value are key characteristics of big data; and by analyzing it in real-time, AI algorithms can detect discrepancies and prevent fraud. AI also secures consumer data. It has reduced credit card fraud significantly.

When thinking about using AI for your bank, start with a small area that can be automated. Basic yet high-impact tasks will help you implement artificial intelligence in banking without disrupting your organization’s ecosystem.