How to leverage AI/ML in Digital Banking to Reimagine Customer Engagement?

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The Wave of 'All Things Customer' and How It Impacts Digital Banking

As technology evolves, the demands on banks and financial services grow accordingly. Customers now anticipate tools that are not only intuitive and seamless but also fast. These advanced tools are pivotal in enabling banks to enhance customer engagement, aligning with their desired objectives. A report by the Financial Brand highlights that customers today seek financial services equivalent to a 'GPS'—services that assist them in navigating their finances and achieving their financial goals with optimal efficiency.

To meet these rising expectations, banks can embrace the power of digital banking engagement tools that leverage data, analytics, and real-time communication on a large scale. By embracing these evolving technologies, banks can effectively develop themselves, ensuring they keep pace with customer demands and deliver an enhanced banking experience.


How Is AL/ML In Digital Banking Helpful?


Automation that creates fast, seamless, and reliable processes

Artificial Intelligence (AI) allows banks to streamline processes and enhance efficiency. Automation is a crucial application of AI in the financial and banking sectors, providing significant benefits. The potential for AI in the financial industry is vast, enabling banks to simplify and automate tasks that humans previously performed. This automation reduces reliance on legacy systems, which occupy space and incur additional costs. Additionally, time-consuming and tedious processes like onboarding can be greatly improved through automation.

A notable example of AI implementation is the collaboration between NatWest, a UK digital bank, and Tink, a Swedish open platform company. Together, they developed an actionable newsfeed feature on NatWest's mobile app, leveraging AI technology. This innovative integration proved successful, as evidenced by the acquisition of 1.3 million responses within the first two months of its launch. This demonstrates AI's effectiveness and potential impact in transforming the banking experience for customers.


Improved customer experience with intelligent tools

In recent years, the adoption of chatbots and virtual assistants has been on the rise, and many banks have recognized their value by incorporating them into their mobile applications. The personalization feature of AI chatbots has been a driving force behind their implementation. These chatbots can cater to clients' needs at any time, providing accurate responses to their queries. With their convenience, time-saving nature, and fast and reliable service, AI chatbots offer a highly personalised experience.

CIBC, a prominent Canadian bank, exemplifies the effective utilisation of data to deliver an omnichannel experience and drive customer acquisition. By leveraging data-driven approaches, they have implemented targeted mobile promotions, seamlessly synchronising data to update product pages at scale swiftly. This modular approach allows them to utilise existing behavioural data to precisely target messages while also enabling them to reuse and combine the real-time content to tailor to specific customer profiles. CIBC's innovative use of data-driven strategies demonstrates the power of personalization and scalability in enhancing the overall customer experience.


Elevated customer engagement

Integrating AI and Machine Learning in banking apps can revolutionise the industry. By leveraging these advanced technologies, banks can gain valuable insights into customer needs and preferences, enabling them to provide tailored solutions. One notable advantage of implementing AI/ML is that banks can offer uninterrupted service to customers, even on bank holidays. This continuous availability ensures that customers receive support and assistance whenever needed, enhancing customer satisfaction and loyalty.


Redefining portfolio management with AI

The utilisation of artificial intelligence has immense potential to optimise personal financial management, wealth management, and portfolio management. Moreover, AI can significantly enhance the management system for debit and credit cards, particularly regarding security. By automating the handling of credit and debit cards, AI improves security measures and streamlines the authentication process, ensuring the safety of all transactions. As a result, the integration of artificial intelligence in banking empowers and enhances mobile financial services, offering customers a seamless and secure experience.


Risk management and fraud detection with AI

Artificial intelligence integrated into banking apps can mitigate fraud by effectively identifying risks. It is especially well-suited for risk management, encompassing document verification, loan approval, and financial assessment tasks. By leveraging AI and machine learning, these activities can be handled with enhanced accuracy and privacy, ensuring more reliable and secure processes within the banking industry.


A New Hope for Customer Engagement with AI/ML

In a study conducted by Digital Banking Report, several significant challenges were identified for banks. These challenges encompass simplified account opening and digital onboarding, the lack of intelligent personal financial management tools (PFM) and proactive advisory services, and the need to educate employees with analytics to better assist new customers. Recognizing and addressing these pain points is crucial for banks to enhance customer experiences, promote financial empowerment, and foster a more knowledgeable and efficient workforce.


Bridging the gap with AI/ML

"Data plays a critical role in identifying target customers, personalising their experiences, and nurturing customer relationships," emphasises the head of banking at Zurich Cantonal Bank, Switzerland, and we wholeheartedly agree. Banks can enhance their operations across all channels by harnessing the power of data, robust analytics, and AI/ML algorithms, delivering the personalised, omnichannel experiences customers seek in their digital interactions.

While AI/ML alone may not be the sole driver of the banking sector's future, its integration becomes imperative for banks to achieve scalability and attain the desired level of customer engagement and revenue.

Banks face constant pressure to embrace new technologies, which is where Clayfin comes into play. We exist to help banks accomplish their objectives while meeting customer expectations. Our services leverage intelligent technology to provide transparency and guaranteed scalability. Contact us to learn more about how we can assist you.

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