AI in banking is a relatively new concept, but it’s already making banks safer, more efficient, and more accessible. Banks must constantly innovate to manage the increased demand coming from both financial regulators and increasingly demanding consumers.
AI can provide solutions!! We need to look at how AI banking is being used today to anticipate how it will change money management over the next decade. It is difficult to not be captivated by the benefits of artificial intelligence banking which has certainly brought a ray of light to the banking industry.
Some banks such as BBVA and UBS now use robotic assistants for their customer service. This customer service is provided by chatbots and many more of these services are helping to handle customer complaints, type in customer complaints, generate letters and documents on customer requests, and make decisions about loans, insurance, and credit card applications.
AI in Banking Today:
The financial services sector represents 20-25% of the global economy and its growth is essential for the future prosperity of families, businesses, and nations. Without ai in finance, it becomes difficult for Banks to be highly efficient and secure, especially amid cybercrime and growing user demands.
Artificial intelligence in banking is not a fad feat that will come and go without leaving a lasting impression on the business world. Instead, AI is here to stay and will be responsible for real change in the banking industry. In fact, McKinsey reported that AI could deliver $1 trillion of additional value to the banking industry each year.
Benefits of AI in the Banking Industry:
Banks are adopting ai for finance to use face recognition and pattern recognition. In the former, instead of the traditional password-based authentication, there is the use of face recognition that can open accounts.
In the latter, there is a development of a system that recognizes clients’ emotions from their facial expressions so as to interpret their moods. This can be used to provide quality service such as providing emoticons. Banks are also using AI in robots as assistants.
They are employing chatbots that can interact with customers in real-time and automate routine processes. A bank that uses AI in investment banking can better preserve five aspects which are its values, employment, information patterns, structure, and strategy.
To cut it short, the following are the main benefits of AI in banking:
- Improved service responses
- Reduction in human error
- Personalized options in the making
- Strengthening customer base by increasing satisfaction and trust
- Reducing time to travel locations
Therefore, Finance and banking sectors, affected by Big Data applications are already relying heavily on the future of technology in banking to develop new services and find newer, innovative ways of interacting with their customers.
Application Areas of AI in the Banking Industry:
Below are some of the application areas of AI in banking:
#1. Fraud Detection
Fraud detection is one of the most significant applications of emerging AI in banking. With advances in data science, banks can train systems to make predictions and detect anomalies that prevent fraud. One reason organizations struggle with fraud detection is its frequent evolution, which requires continual training and updates.
Banks increasingly use machine learning, which allows updated algorithms to adapt as fraud becomes more sophisticated. Undoubtedly, Artificial intelligence (AI) fraud detection tools have proven 50% more accurate than rule-based systems. This is a potentially powerful new way to combat the increased fraud in banking and financial services provided by technology.
#2. Cyber Security
As cyber threats become more advanced and frequent, banks are turning to AI cybersecurity to help protect against attacks. With machine learning, blockchain, and other tools, banks can discover and manage new risks with better accuracy and efficiency.
Ai in banking can stop potential attacks before they affect internal systems or customers, allowing them to stay ahead of ever-changing security threats. Over half of all cyberattacks target employees in the first place, with programs like phishing trojans being among the most common. The risk of a cyber attack at your company is rising, but your IT department may not be able to stop it.
#3. Risk Management
Running a bank is no easy feat. There are plenty of risks to consider, and none more so than lending. Thus, new technology is opening doors for people who have been left out of the traditional lending system. Banks, credit card providers, and other financial institutions are using AI in banking and big data to make more informed decisions about people’s creditworthiness.
This gives lower-risk consumers a better chance at borrowing money to finance their needs or emergencies. AI in banking is constantly letting banks like yours offer loans and credit services with less risk — so you can feel more confident about helping people who need it.
#4. Regulatory Compliance
Compliance is very important in banks. Compliance means complying with laws and regulations, helping organizations run in an ethical and transparent manner, and maintaining high standards. This means all employees must follow the same guidelines. It’s a way to prevent mistakes and makes the banking industry safer overall.
At their most advanced, artificial intelligence and banking contain many learning abilities, including the ability to create their own new general knowledge based on what they have learned.
#5. Customer Service
Banks that don’t evolve with consumer behaviors risk losing their clients to faster, more efficient services with lower transaction fees. Chatbots are one of the powerful examples of artificial intelligence in banking that can help banks address challenges such as staffing shortages and difficult client interactions by giving clients a convenient way to reach them.
They help automate customer-facing operations and improve customer satisfaction. Banks that employ chatbots and other AI tools in the future will have better cost control and an improved customer experience, gaining a competitive edge over their rivals.
How Mobcoder can help you in your AI journey?
Ai in banking is no longer just a concept or something that only exists in science fiction. There are viable, day-to-day applications available for banks to adopt and integrate, and there are even more AI solutions in the pipeline
Mobcoder has an Unbiased and Holistic Approach to AI. Our team of AI Developers, Data Scientists, and Business Analysts offers a customized AI solution to the clients that helps them improve the performance of their business at both end-end points (in more latent ways).
Mobcoder’s custom AI solutions play a significant role in improving customer-facing operations and also lending support to the internal activities by automating them into process flows which reduce operational costs and improve revenue.
Ai in banking has several benefits, it helps in improving the industry’s operations. Not to mention artificial intelligence acts as a catalyst for all bank employees, empowering them with adequate information, hence minimizing errors and improving efficiency.
The use of ai in banking makes it possible to determine any kind of glitches and also plan for new developments within the bank. Hence, it helps both the employees and the customers as well. Banks play an important role in the financial relationship between investors and start-up companies, where the traditional methods are not enough to fathom extensive business requirements.
Thus, AI in banking is needed to enhance customer service and improve the relationship with new clientele.