Optimising Customer Banking Experiences with AI (Guest blog by DXC Technology)
Artificial intelligence (AI) is powering the banking and capital markets industry's enablement to improve customer engagement and deliver truly personalised customer-driven experiences. The usage of AI is steadily increasing across many banks, building societies and other financial services institutions. AI algorithms and advanced analytics are designed to make instant decisions using real-time data. This is to perform complex and intelligent functions associated with human thinking, unlike machines that react to rules-based logic or deliver pre-determined responses. To provide AI with the capacity to self-learn instead of humans inputting data to assign actions, machine learning (ML) is an area of AI that can help.
Welcome ChatGPT
One of the recent evolutions that has come from AI is GPT-3-powered ChatGPT, a natural language processing (NLP) tool developed by OpenAI, a US-based artificial intelligence research lab. ChatGPT can have human conversations and solve problems. The acronym ChatGPT is made up of two words: chat (as in ChatBot!) and generative pre-trained transformer (GPT). According to OpenAI, ChatGPT-3 was trained on over 45 terabytes of data.
So how can ChatGPT be beneficial in the banking and capital markets industry? ChatGPT can be used to generate receipts and invoices, develop chatbots to assist customers with making payments, answering questions about payment options, and troubleshooting issues, give financial services advice to consumers, and much more. According to a recent report, within a space of under two months after its launch at the end of November 2022, ChatGPT reached a staggering 100 million monthly active users, becoming the fastest-growing app in history.
According to IDC, the banking and capital industry leads the way in AI adoption, with tech spending on AI systems in lending alone expected to increase to $27.7 billion in 2025 (from $11.7 billion in 2021). In 2022, JP Morgan Chase spent over US$12bn on technology, including AI and ML to get more value out of its data. Investments like these are fueling rapid AI innovation and transforming the customer journey across the industry.
Data fuels everything
Successful AI application in the banking and capital markets industry starts with customers (or members in the case of building societies) using easy-to-use and understandable digital products and offerings, such as apps or contactless cards for example. Such products drive customer engagement, generating more data in relation to personal preferences, regional settings and more. AI takes this data and in real-time constantly trains the AI model, leading to the improvement of more products and offerings.
As an example, by moving to image-based cheque-clearing, DXC helped NatWest Group increase speed and accuracy and enabled automated image fraud detection based on ML and AI technologies. In the case of one Australian bank, DXC used data engineering, AI and ML to help the bank’s IT team build a solution to predict and resolve IT outages before they occurred.
AI can save costs
According to a recent report by Insider Intelligence by 2023, banks worldwide can make savings of $447 billion due to AI, with the front and middle office accounting for $416 billion of that total. While the use of AI has been a major step forward in the digitization of banking and cost savings, humans will always have a place in customer interactions. It is worth noting that technologies such as ChatGPT will not replace people. But people who use ChatGPT may replace those who don’t.
The future of banking
The availability of AI-enabled solutions enables banking and capital markets to deliver customer-driven experiences, providing application strategy and methodology is planned according to business needs.
AI is clearly a game-changer, and it goes without saying that the technology is amazing, but the full potential can only be enjoyed by customers if the banking infrastructure is able to support the technology and data needs.
DXC delivers complex, integrated applications—driven by AI and ML—while ensuring adherence to privacy regulations and requirements. Contact us to learn more.
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