If you're running a financial services firm focused on digital transformation, determining what needs updating proves essential. “In all honesty, what areas aren't there?” according to Teddy Flo, general counsel at Zest AI. “The financial services industry is vastly behind other consumer-centric industries in a lot of ways.”
Transformations should prioritize one objective: enriching customer relationships with financial institutions. “You can't change anything for the better if everyone doesn't have equitable access to capital,” Flo explains. “The way we make decisions on credit should be fair and inclusive and done in a way that takes into account a greater picture of a person.”
Personalise without branches
AI enables personalised experiences despite declining physical locations. “Artificial intelligence can help redefine and restore personalised experiences that build trust,” says Charlene Coleman, senior managing partner at Launch Consulting Group. AI-powered conversational interfaces and biometric profiles show promise in helping vulnerable consumers “avoid debt traps fueled by late fees and inflexible payment schedules.”
Make more informed risks
AI improves risk assessment and capital allocation decisions. Dr. Lewis Z. Liu, CEO of Eigen Technologies, notes financial institutions currently “make risk, capital allocation and underwriting decisions, based on as little as 10% of the data available to them.” Through AI implementation, organisations access “previously inaccessible 90% of relevant data, enabling them to make more informed and better decisions.”
Reduce or prevent fraud
AI tackles fraudulent activities and money laundering. “Companies are leveraging AI to monitor large number of credit card and e-payment transactions daily, detect changes in our purchase behavior,” explains Vrinda Khurjekar, senior director at Searce.
Speed up services
Manual processes remain prevalent due to automation challenges. Loan processing, customer onboarding, and check deposits could “be reduced drastically if the banks had less technical debt and were able to adopt new age cloud solutions faster.”
Leverage human–AI partnerships
Successful implementations maintain human oversight. “Credit underwriting decisions made only by an algorithm designed without humans in the loop will ignite the risk of prioritizing profit while ignoring social impact,” Coleman cautions.
Banks increasingly invest in technology stacks, with many evaluating cloud migration and AI implementation for consumer behaviour prediction and fraud detection.