It’s now been about a year since generative artificial intelligence was launched into the public zeitgeist thanks to tools like ChatGPT, DALL•E and Midjourney exploding in popularity. But beyond text- and image-based content creation, these kinds of generative AI tools have the potential to revolutionize countless industries by maximizing operational efficiency and productivity.
This is especially true in the banking industry, which stands to benefit enormously from machine learning and natural language processing. In fact, McKinsey estimates that generative AI has the potential to generate $200 billion to $340 billion in additional value — or about 3-5% of the global industry’s revenue. All this begs the question: How does a generative AI tool drive productivity for banks?
When it comes to banking operations and management processes, almost every organization faces a few points of frustration:
All of these issues can lead to inefficiencies that harm not only the customer experience but also the organization’s bottom line.
Generative solutions address these challenges directly with a range of AI-powered features, from virtual assistants that automate tasks to data analysis tools that drive informed decision-making.
Here are just a few of the ways the banking industry is using AI technology to maximize productivity:
Customer service is typically one of the first areas banks go to when integrating an AI productivity tool. This is because, while it’s an essential function, teams often perform repetitive tasks that take time away from other high-value work.
With an AI chatbot that uses natural language processing, banks can help customers answer their own questions, only escalating queries to a live agent when necessary. When agents do need to step in, the AI assistant tool can help by providing a summary of the customer’s information as well as the context of previous interactions.
AI technology is also expected to transform the function of software development — including R&D testing. According to the McKinsey report from earlier, this will have significant impacts on the banking industry across four categories:
All of these capabilities combine to streamline and accelerate the software development process, allowing banks to stay agile in today’s rapidly changing digital landscape.
Data collection is another area where banks are finding a lot of value in AI. For instance, when an AI agent has a conversation with a customer, not only does it save the transcript, but it can also sort through thousands of similar chat logs to identify patterns. These would be incredibly time-consuming, mundane tasks for a human, but AI excels here.
Data analysis is the second component of this valuable use case, leveraging an AI algorithm to automate complex, time-consuming tasks, such as finding trends in data and making predictions. Banks can also benefit from AI’s ability to uncover hidden patterns that might not pop out to the human eye, providing deeper, speedier insights than manual analysis.
AI’s data analysis capabilities can also come in handy for managing risks and maintaining compliance. This is especially important when customers need to input sensitive data or personally identifiable information (PII) to find an answer to their questions. An AI tool can automatically detect and scrub this type of information from call and chat transcripts to mitigate potential data privacy risks.
At the same time, machine learning can be used to analyze customer data for suspicious activity or potential incidents of fraud. This can help prevent financial losses for both the customer and the bank — all while minimizing the resources required for this kind of support.
As you can likely tell from the many use cases above, generative AI provides banks with a distinct competitive advantage, allowing their customer support operations to be more nimble, efficient and effective while maximizing productivity.
While you might not need or want to implement every use case, introducing an AI agent alone can offer numerous benefits, including:
But how can you unlock the productivity benefits of AI for banking?
As you ready your organization to take advantage of the coming AI revolution, it’s important to follow a few essential best practices:
First and foremost, AI is here to stay. While the evolution might be rapid, it’s crucial to embrace innovations early, giving your organization the time it needs to properly implement this new technology. With a proactive approach to AI integration, you can stay on the cutting edge of recent advancements and maintain a competitive advantage to help overcome the challenges of the financial sector.
Deploying a new AI productivity tool can be exciting, but it’s essential to maintain the human element in banking. Rather than having an AI agent handle every customer call, a blend of automated processes and human-centric interactions can help live agents manage their workloads while ensuring customers feel valued and receive the answers they need.
It’s also critical to stay updated on the latest news within both the banking and AI industries. By understanding the most recent advancements, regulatory changes and emerging trends in the field of banking and AI, you’ll be better informed and more prepared to not only adapt to market shifts and meet customer demands but also to adopt innovative solutions that enable greater productivity.
Similarly, you’ll also need to stay abreast of industry changes to identify and mitigate potential risks. As AI adoption becomes commonplace in the banking industry, new regulations will undoubtedly introduce new risks and compliance issues that will be critical to address. From data security and privacy laws to ethical implications, financial institutions will need to develop robust risk mitigation processes such as conducting regular assessments and establishing robust security protocols.
Finally, but perhaps most importantly, banks will need to choose the right AI partner for what they need. While there are plenty of AI-enabled solutions on the market, it’s crucial to partner with an organization that was built from the ground up as an AI and banking solution provider. Unlike other companies, they’ll have in-depth knowledge and understanding of both worlds, along with the required compliance needs and security protocols.
Are you looking for an AI productivity tool to help streamline your banking operations?
Posh is a native AI company delivering a powerful suite of solutions for financial institutions. From a 24/7 voice agent and chatbot system to our easy-to-use internal knowledge assistant, discover how AI can boost your productivity.
Request a demo today.