Artificial Intelligence: Making banks future-ready 

August 23, 2021

The banking industry has undergone a massive technology-led change in the past couple of years, especially driven by artificial intelligence (AI). From integrating conversational chatbots to AI-powered solutions, banks and other financial institutions are looking for advanced ways to improve their operations and provide an enhanced banking experience to customers.

Today around 1.9 billion customers prefer using digital banking services over traditional banking methods, and to offer a safe and secure banking experience, banks have to be technologically ready.

AI is undoubtedly the pivot of digitization in the banking sector as it introduced the banks to facial recognition, fingerprint access, voice recognition, and anomaly detection capabilities to ensure secured processing every time. AI also enables banks to accelerate their internal processes by creating simplified algorithms to increase operational efficiency and reduce operating costs. There are myriads of other ways how AI is reshaping the consumer banking sector.

customer reviewImproved customer experience

Customer experience is one of the critical factors in determining the success of any business, especially in the banking landscape. It directly affects customer’s perceptions of the bank.

AI-powered solutions like chatbots and voice assistants are reshaping how banks communicate with their clients. They empower banks to target new customers and retain the existing ones. Using chatbots, banks can now be available even after working hours to assist customers in resolving their queries. Banks can now deliver personalized banking experiences to customers by monitoring their previous interactions and browsing history.

risk 1Enhanced risk management

AI is a big game-changer in the banking industry when it comes to risk management. Due to a large amount of customer personal information and data, banks are always at a high risk of a potential breach. Using AI-powered innovative solutions, banks can quickly minimize the risk of data being manipulated or leaked.

Banks can easily scan a large amount of data in one go and identify various patterns from different channels to detect any malicious activity. It helps banks to prevent money laundering and reduce credit risks. Smart AI algorithms have entirely transformed how banks work, enhancing risk management for trusted banking experience.

innovation 1Faster regulatory compliance

The ability to quickly adapt to changing regulatory compliance can give a distinct competitive advantage to banks as the financial sector is one of the most regulated industries.

Banks have a lot to keep a check upon, from money laundering to theft prevention and default credit holders. AI solutions help banks identify these risks to offer a reliable customer experience. Tools and software follow a cognitive fraud approach that helps banks scrutinize customer behaviors and track transactions to identify suspicious activities, leading to data assessment of various compliance systems.

money bagBetter loan and credit management

One of the main functions of banks is to provide a loan. Banks must manage their client’s information properly and run a thorough background check to avoid defaulters. They need to focus on factors like credit score, credit history, revenue, and banking transactions to conclude if a customer is creditworthy or not. Doing everything manually is not only cumbersome but unreliable too. AI-based loan decision systems can assist banks in making much accurate and reliable loan-lending decisions by observing past patterns and behaviors of a customer to determine if he is creditworthy or not.

moneyReduced operating costs

Although the banking sector is already working towards digitization, employees still have many files and records to maintain. These tasks are mundane, time-consuming, and hamper the overall employee productivity and operational efficiency, leaving room for human-prone errors.

By adopting the latest AI assistants and automation tools, banks can work on technology-driven models that are more efficient and promise better control. Manual and repetitive tasks like collecting, classifying, and entering customer data directly from forms can be easily automated and streamlined for better efficiency. It reduces operational costs and allows employees to focus on delivering high-quality personalized services to customers.

project managementMore innovation opportunities

Banking is a very competitive industry, and with the help of AI, banks can keep innovating themselves and provide better customer services. For example, customers usually struggle with making the right financial decision. By observing the history and transactions patterns, banks can suggest better investment options and provide financial advice. AI tools can trace the digital footprints left by customers by making transactions via credit card, analyze the spending pattern, and turn them into actionable insights. This way, banks can shift from providing just financial services to facilitating customer’s financial betterment.

AI solutions can completely reshape how the banking industry works today. Banks can focus on providing a much-personalized experience to their customers, increasing their employee productivity, reducing overall operational costs. AI helps banks work on flexible and agile business models that are an absolute necessity to grow in this digital world. PureSoftware has helped many banks in their digital journey by providing industry-leading technology-led solutions. If you are also looking for a reliable digital transformation partner, get in touch with our team soon.

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